Full text of Commercial and Financial Chronicle : November 15, 1951, Vol. 174, No. 5064

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JZ,

1951

M 1 -j
BUSINESS
•

MWIHSTttTIWI
UBWKf

•

ESTABLISHED 1S39

—

Reg. U. S. Pat. Office

Volume 174

Number 5064

New

York, N. Y., Thursday, November 15, 1951

Price 40 Cents

Copy

EDITORIAL

Funds Buy on Balance

We See It

HENRY

ANSBACHER

Raw Materials Prices

LONG

By MELCHIOR PALYI

Investment companies' third-quarter purchases exceeded
The

change of Government in England and
impending visit of the new Prime Minister
to this
country bring again to the fore some vital
questions about Britain and the British Empire.
These questions,- ordinarily perhaps best left to
the British to solve as they think best, cannot in
existing circumstances be regarded as wholly
foreign to the legitimate. interests of the United
States.. In fact they more or less
vitally affect
us at several
points, and accordingly it is neces¬
sary that the American people at large come to
some
sort of reasonable
understanding of the

sales

the

by 25%,

cash

one-third of companies drew down

basic
It

therefor.

has become

two

the

investments

costly world

..."

;.'r.

;

in oils and

ferrous

chemicals.

metals

noted

accumulated

over-all

war

cost the British

ment and

British

people, but they
are

amenable

action

the

headway in eliminating

the former. ■\V;;

pace

period, but there
to

was

stocks

were

continued

round

Long

Jv ;,,

■;

commitments

purchases

the

latter

issues

well

Continued

the

New

institutions initiated in the June period.
Less aggressive buying was also evidenced in the rails
and
non-ferrous metal industry.
Sales approximated

12
THIS

ISSUE

Turn

even

relatively

ef¬

peacetime, at

rate—a

any

profit

impulse

new

inherent

in
Dr. Melchior Palyi

One is the American practice of permit¬
of fresh investments.

ting the accelerated amortization
This

works

out

premium

attract

capital into

mining ventures, especially of a sub-marginal character,
by greatly reducing the corporate tax liability which is

those

page

Extraordinary incentives are being provided abroad
by the U. S. Government in "its search for scarce min¬
erals

the

far corners of the
globe." The Defense
Procurement Agency—a new one on the tax¬
payer—covers
Latin America, Africa, Southern Asia
and Polynesia.
It offers the raw material producers

Material

engineering

know-how,

priorities

on.

equipment,

Continued

25, 26, 27 and 28 for pictures taken at the
Security Dealers Association at
Waldorf Astoria, New York City on November 9.
—

over

the biggest single financial deterrent.

bought, but with much less
previous quarter. Affiliated Fund
its

indicated

tional stimuli.

York financial

Long Term Change

PICTURES

Henry

A reversal in

out

than

The

still

enthusiasm than in the

fluctuate

high prices (on a sellers' market at
that) is being intensified by addi¬

Buying of Bank Stocks
Bank

might

change
They mean
less, for years

balance of supply and demand.

commit¬

prices

forces should

-—in

shares.-'Vv. "v;>

The fact of the matter is that the tide had defpage

gas,

stocks due

lightening

markets.

by the aver¬
ages, inflated as they are. Individual
commodity prices
have
increased
beyond all experience of a century;
they should suffice to bring about

sus¬

that

come;

fective

deemed

was

ket

the previous three months' bearish attitude toward cer¬
tain industries was apparent as
managers purchased on
balance steel, auto
and broadcasting and amusement

same

ments in United Fruit.

ameliorating

Continued

June

primarily

-v..,

issues

natural

increase in sales of food

the part of the British.
Only by addressing them¬
selves to these latter is it possible for the British
to make

were

tained at about the

only factors, and it is these other conditions and
circumstances which

stocks

Interest

textiles and drug equities

not the

are

radio

attractive.

their

of the

individual

the

"structural"

that bottlenecks will be with us, more

Theoretically, high prices should
provide the profit impulse to ex¬
pand production, in turn correcting
extravagant prices, if not breaking
them. This automatism of the mar¬

utility shares, although there
in

European experts speak of
occurring on the raw material

short periods but will stay high; and
that their trend is definitely upward.

Also, as in the previ¬
ous quarter,
longer term prospects of
the merchandising, electrical equip¬

capital accumulations at home.
These, of course; are basic factors in the current
ills

secur¬

most favored.

substantial

selling of portfolio securities

shifts

were

part

for

ence

been

incident to total

remaining

not the rule, and total purchases
actually exceeded
sales
by
25%.
Managements continued their prefer¬

large amounts, some of which at least
or is
being honored in one degree or
another. Every school child also knows that Ger¬
man
bombing and other destruction or exhaustion
has

was

decades, even centuries, preceding the outbreak
in 1914,-and in addition has accumulated
foreign
debt

over original cost.
But despite the rise in general
ity prices during both the quarterly •
and
previous
12
months'
period,

abroad

with building
unpopular.

added impulse from renewed industrialization
Japan and Germany. Concludes crude materials prices
are most
likely to move higher.

receive

non-

Shortages in Permanence?

commonplace that Britain in
has lost a large part of
had

Cooling of enthusiasm for

Investment companies took partial profits on their oil
and chemical holdings in the third quarter of the
year
as these industries' issues
registered sizable appreciation

wars

favorites, as merchan¬
dising, radio, electrical equipment, natural gas and tex¬
tile issues were also bought on balance.
Profits taken

position of Britain at this time and the

reasons

Palyi, in calling attention to rising raw materials
prices, sees in this development incentives t3 greater
output under the profit impulse. Says prospects in next
year should be bullish for raw materials, which
will

Utilities continued

reserves.

economic

Dr.

and

page

pages

26th Annual Dinner of the New York

U. S.

State and

Government,

State and

Municipal

Securities

Munkipa
600 Branches

R. H. Johnson & Co.
.,

Established 1927

across

Canada
/

telephone:

HAnover 2-3700
;

SECURITIES

Monthly Commercial Letter

& TRUST

Troy

30 BROAD

Street, New York 5

Wilkes-Barre

ST., N. Y

THE NATIONAL CITY BANK

PHILADELPHIA

Albany

Providence

bond department
'

•

Buffalo

■

Harrisburg
Scranton

Allentown

of Commerce
Head Office: Toronto

Bond

Dept. Teletype: NY 1-708

ISetc York
Seattle

VANCE, SANDERS & CO.
Ill Devonshire Street

BOSTON

New York

Direct

Angeles

•

Ol'!
V *

' ,v'

-i "

Private

S,°Ck„S i
and Bonds

14 Wall

Co.

Street, New York, N. Y.

Members of Principal Commodity

Security

San Francisco

•

Boston

Exchanges

Los Angeles
•

Honolulu

•

DEPARTMENT

CANADIAN

Goodbody

Co.

ESTABLISHED 1891

THE CITY Of NEW YORK

Northern

New England

Company

♦

Analysis

Dominion Securities
Grporatiom
40 Exchange Place, New York 5, N. Y,

CHICAGO

Teletype NY 1-702-3

WHitehall 4-8161

upon request

IRA HAUPT & CO.
Members New York Stock
and

other

111

Principal

Boston

Exchange
Exchanges

Broadway, N. Y. 6

WOrth 4-6000

105 W. ADAMS ST.

115 BROADWAY
NEW YORK

Portland, Ore. San Francisco Los Angeles

sold

MEMBERS NEW YORK STOCK EXCH.

Chicago

NATIONAL BANK

Agency: 2d Exchange Pl.

BONDS & STOCKS

Wire$

Dean Witter

THE CHASE

Quoted

and

Chicago
Los

CANADIAN

Second Fund
Prospect uifrom authorized dealers

Canadian

Pacific Coast &
Hawaiian Securities

Investors

The Canadian Bank

OF NEW YORK

Williamsport

Washington, D. G;

Massachusetts

x-Bond Department
64 Wall
BOSTON

COMPANY

upon request

Chemical
hBANK

'
(

INVESTMENT

Teletype NY 1-2708

Telephone:

Enterprise

1820

The Commercial and Financial Chronicle...
2

jJovehnbef

Thursday,

15, 1951

(1838)

This

The Security I Like

MARKETS

TRADING

Foreign internal

Best

week, a different group of experts
and advisory field from all sections of the country

in the investment

and

participate and give their

for favoring

reasons

External Securities

•

they to be regarded,

as an

J. Low*

Security Analyst, Bruns,
N. Y. C. (P. 2)

Louisiana Securities

Nordeman & Co.,

Drive

Wheel

Four

Co.—

Auto

Irving J. Rice, President, Irving

are not intended to be, nor
offer to sell the securities discussed.)

(The articles contained in this forum
are

Alabama &

Tide Water Associated Oil—Henry

particular security.

and

Selections

Their

A continuous forum in which, each

Week's

Participants

Forum

Rice

Co., Inc., Saint Paul,

Bought—Sold—Quoted

Minn. (P. 2)

Ettablished 1920

Members, New York Stock Exchange

York 5

Teletype NY 1-583

BArclay 7-5660

Water Associated

Tide

equity

standing

ments

Oil
select

asked

When

for

forum, "The Security I Like Best,"
I found a natural answer in what

Specialists in

to be
unique op¬

appears
a

fered

Since 1917

fornia, Oklahoma and New Jer¬
sey,
with a daily capacity of
188,000 barrels. It also owns three

Associated Oil.
Tide

Members

Hew

120

York

Tel.

phases of the
petroleum in¬
dustry. The

Henry J. Low

^IIIIIIIIIIllllHIIIIIIIUHIIIIUIHlfUllir

Co.

American Furniture
Dan River Mills

Handley Hardware Co.

America, Western Europe, Africa,
Turkey, India, the Philippines and
Japan.
•••;.. 7
•
" > •

of oil and gas.

Water's crude oil produc¬

largely obtained from sev¬
domestic oil fields,
as
East Texas, New Hope,

tion is

major

Kelly-Snyder, Yates, Conroe, Ca¬

acquired

Water

Tide

1950

222,000 acres of new leases
promising for the dis¬

some

of oil and gas, Among the
important purchases were

covery

most
,

Circular

Request

2,100 acres of proven oil lands in
the West Texas counties of Borden

With

producing

and

BUTLER, CANDEE & MOSER
York 5, N. Y.

44 Wall St., Hew

Scurry.

wells

presently drilling and fur¬
intensified exploration pro¬

ther

BOwling Green

Teletype
NY

9-0040

1-1862

Markets

West Coast Securities
Portland General
San Diego Gas &

Electric

Pacific

Electric
Power

McANDREW & CO.
INCORPORATED

Francisco 4
Tele. SF 370

crude

oil

being developed. Ear¬

UTILITY STOCKS
Private
to

New

Telephone

of Alberta,

Canada. Large proven gas reserves

CAnal 6-1613
1. b. Mag aire & Co., Inc.

Dealers Inc.

31 Milk St, Boston 9, Mass.
Tel. HUbbard 2-5500

Portland, Me.
Hartford, Conn.

bringing

Tele. BS 142

Enterprise 2904
Enterprise 6800

Omen End Phone to Hew York Canal 6~1613

total

1951

per

annual

and

ing

cash

June 30, 1951, includ¬
and government secu¬

rities

$37;621,000,

these very im¬

portant factors

together
J.

Irving

with

another

Rice

Province
other

Saskatchewan

Water, together with
oil

producers,

has

and

exploration program is sched¬

uled for the next 12 to 18 months.
Recent discoveries in the
Basin

region

Montana

and

North

South

Williston

Dakota,

Saskatche¬

and also in the nearby Prov¬
of Manitoba indicate great
potential for future oil findings in
this section. In addition, the com¬
pany owns a 25% interest in 1,360,000 acres in the Keg River
area

of northwestern

also

in 211.000

acres,

from Canadian Pacific
western

Tide
crude

Alberta and

under lease

Railway, in

Saskatchewan.
Water's

oil

total

Pacific

50.1%

owned by the

are

production in 1950

was

Company

Oil

Western

11.5% by
Corporation.1

and

redemption of its remaining

172,135 shares of preferred stock
on

July 1, 1950 Tide Water's ultra

conservative management success¬

fully accomplished complete elim¬
ination of $98,000,000

debt and
a

of long-term

preferred shares during
years. At the same
stock equity was

Common

important fac¬
'

management

Drive

Wheel

Four

Rgts."

Pfd. & Rgts.

4Vz %

pany

companies,, t h e

Air Reduction

tor,-namely, intrinsic value.
Four Wheel Drive Auto Com¬

Foote Mineral

Point Field Trust

Cedar

GERSTEN & FRENKKL
Members

Security

150 Broadway
Tel.

DIgby 9-1550

Dealers

Assn.

New York 1
Tel. NY 1-1932

gradually

Specializing in

Amalgamated Sugar
'

■

Utah-Idaho Sugar

values, particularly in the case of
Four Wheel Drive Auto Company.

common

than

doubled.

time

pany

there are

the

history
no

the

com¬

senior obliga¬

tions ahead of the common stocks

EDWARD L. BURTON

view

the

company's

new

freedom for expansion and of the

controlling

interest

the Getty

family, who have shown a willing
ness
toward active drilling
and
exploration, a changeover to com¬
plete integration of Tide Water's
facilities
with
emphasis on
in¬
production

tion of crude oil
imminent.

and

reserves

acquisi¬
appears

& COMPANY
Established 1899

St.

160 S. Main

Teletype SU

Bell
•

•

Salt Lake City 1
464

Oldest Investment House

in Utah

■y.;'7'i:-;B UY ':;y:.r

has increased sharply. Sev¬

nance,

eral

companies,

Gas

and

including Pacific
and

Electric,

California Edison, have
ized

>
.

FWD.

comoanies
trucks

Lumber and pacer

are

Southern
standard¬

SAVINGS

BONDS

finding FWD
efficient for

most

hauling heavy logs. Northern In¬
diana Public Service is currently

laying what is believed to be the
largest privately constructed gas
pipeline in the nation, on which

using Four Wheel Drive
haul machinery, mate¬
For the first rials and long pipes directly to

period of 17

time the

creased

domestic

Standard Oil of Ohio

very

With

where Tide

of '

$40,736,000,

past two years geophysical activi¬
ties have also been carried on in
the

258

4-5000

com-

capital po¬ ing portion of its cycle. Yet this
has not been reflected by market
$121,-"

working

opment

9, Mass.

Teletype BS

sition with current assets of

pipe line facili¬
ties become available. During the
soon

7-0425

Y. Telephone WOrth

■;;

yearly payments in the company's ucts, which should smooth out the
history. Dividends have been paid valleys to some extent...:
The
heavy truck
industry is
continuously since 1936. -/.p
Tide Water is in very sound fi¬ currently in the sharply ascend¬
nancial

CA.

$2.15 per share leveling off its . cyclical tendency
stock and the highest through the addition of other prod¬

common

request

State St., Boston

148
Tel.

am?.

both

bines

Information

y.,

disbursements
of

cents

Getty interests through ownership
of about 38.6% by Mission Devel¬

wan,
ince

York

Sternberg Nat'l Assn. of Securities

dividend

discovery with
on a block ities.

joint interest in 9,000,000 acres of
oil lands.
An intensified drilling

Direct

extra

new

in the Province

three

ACTIVE TRADING MARKETS IN

rently

are

Central

and

writing3,; cur* ;,

;

keted

1900 Russ Bldg., San

have been found and can be mar¬

Common Stocks

Tel. EXbrook 2-7900

Water's

the year a

acres

Sierra

greases

Prior to World War II, the com¬
compared
current liabil¬ pany's sales were largely to mu¬
and its trucks were
Book value on June 30, 1951 nicipalities
well was completed
used for road construction, high¬
of 2,480 acres in Lea County, New stood at $41.62 per share. «--•*way maintenance, and snow plow¬
Mexico.
3,000 additional acres are
Total crude oil reserves of Tide
During the War, military
owned in the immediate vicinity Water are officially estimated at ing.
demands for the company's prod¬
of this promising discovery.
517 million
barrels
and natural
ucts were tremendous. Sales hit a
In 1948 Tide Water, through a gas reserves in excess of IV2 tril¬ record of $39,000,000 during 1944
lion cubic feet.
wholly owned subsidiary, acquired
and 1945. ■;
1
'•
a
20% interest in the Bear Oil
Since the War, the use of FWD
Tide Water's capitalization con¬
Company which owns oil and gas sists solely of 6,396,809 shares of trucks by the utility companies
leases on approximately 4,600,000 common stock, of which 3,208,644 for line construction and mainte¬

reserves are

lier

Active Trading

Tide

THERMO KINO RY.

about

is one of the important pro¬
ducers of heavy duty trucks in the
Net
income
for
nine
months
United States. 'Its foreign agen¬
ended
Sept. 30, 1951 was $4.19 cies are also of great importance
per
share compared with $3.62 so that the company is a decided
per share reported in the same pe¬ factor in export business as well.
riod last year.
Total 1951 earn¬ 7
The7 heavy truck business is

gressing in this area, sizable addi-; 477,000
dons

U. S. THERMO CONTROL

The

Venice, West Bay, Ventura ings: are estimated at about $5.50 cyclical- Its sales and earnings in
Avenue, etc. The latter, producing per share compared with 1950 net the past have fluctuated with the
good gravity crude, is one of Cali¬ income of $5.17 per-share. ...'. : ' demand
for
capital^ goods.
In
fornia's greatest oil fields.
Tide Water recently declared an common
with other progressive

considered
v.

a n c e

yuga,

Collins Radio
r

which

such

LD 33

IIIItlllllllllillllllllllllllllKllIIIIIIUU

V
is

timing

issue

bricating
oils and
increasing to South

Tide

branch offices

Company

speaking,

•

sissippi, New Mexico, Kansas and
Pennsylvania. Out of this total,

eral

Lynchburg, Va.
Tele. LY 83

Drive Auto

5,336

leases

Scott, Horner &
Mason, Inc.

Wheel

Generally

ocean-going tankers and lake ves¬
sels.

149,000 acres are being
maintained in force by production

Moore

■<

Four

Marketing and distribution ac-,
company
op¬
oil producing wells tivities of refined petroleum prod¬
and 95 gas wells in the United ucts throughout the United States
and Canada are handled b,y its 300
States, and also holds oil and gas
leases on approximately 1,600,000 bulk and 1,323 retail service sta¬
tions and, thousands of independ¬
acres, principally in Texas, Cali¬
Exports of lu¬
fornia, Oklahoma, Louisiana, Mis¬ ent distributors.
erates

Trading Markets

engaged in all

2-7815

REctor

Water

Company

Exchange

Curb

our

•

Associated Oil

BROADWAY, NEW YORK 5

Direct wires to

Saint Paul, Minn.
Member Midwest Stock Exchange
/

of Tide Water

York Stock Exchange

NY 1-1557

Birmingham, Ala.
Mobile, Ala.

gasoline plants at Ventura, just" as important in selecting a
with a daily capacity of security as is the particular issue
150,000 barrels, and holds part in¬ itself. The market has advanced
>'
;
on
such
a
terests in nine other plants with
a
combined
i broad * front
daily
capacity
of
| d u r i n g ;; the.
214,000 barrels. Transportation fa¬
past year that
cilities include interests in about
select ivity
4,000 miles of crude oil gathering
now takes
onsystems and pipe lines. In addiv
more
yimportion the company owns a fleet of

commoii stock

pONNELL & CO.

York 4, N. Y.

Calif.,

investor in the

Hew

Exchanqp

Curb Exchange

HAnover 2-0700

RICE

IRVING J.

Stock

York

25 Broad St., New

natural

the

Pres., J. H.

New York

New

President; Irving, h Rice & Co., Inc.,

Cali¬

located

refineries,

four

Young,

and operates

owns

portunity
for
participation
in growth- of¬

Rights & Scrip

Water

Tide

Members

New Orleans, La.
■

refinery needs.

of 56% of

Steiner, Rouse & Co!

Young & Co., Inc., N.Y.C. (P. 35)

of 54% for the two preceding
years.
Present production is be¬
lieved to be in the neighborhocd

popular

the

—James

compared with an aver¬

partner,

Avildsen Tools and Machines, Inc.

age

out¬

Roggenburg,

Roggenburg&Co., N.Y.C.(P. 35)

require¬

refinery

Water's

Tide

ley

Countries—Stan¬

American

Latin

day

Security Analyst,
Bruits, Nordeman & Co.

Corporation
120 Broadway, New

approximately 89,000 barrels per
and has averaged in excess
of 100,000 barrels daily this year.
1950 production was about 52% of

HENRY J. LOW

Hanseatic

New York

they

are

trucks

Over-the-Counter

their installation sites over terrain
of all

Quotation Services

descriptions.

become, a sub¬
stantial factor in fire department
The company has

for 38 Years

equipment and cities large and
small, from Maine to California,
and from Alaska to Florida; are
among
FWD

the

fire

166

cities

trucks.

using

now

Over-the-road

National Quotation Bureau
Incorporated

hauling with four-wheel powered
trucks has also
crease

the

milage, and

been found to in¬

efficiency
more

and

Continued

tire
semi-

and
more,

page

46 Front Street
CHICAGO

- -

Established 1913 :

New York 4,

N.Y.

SAN FRANCISCO

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1839)

Investment Problems

INDEX

In Current
i

Article* and Newt

Economy

Raw

By ROGER F. MURRAY*

Material

Prices—Melchior

Page

Palyi_.

Cover

Vice-President, Bankers Trust Company, New York

Contending wide

movements in investment market

Funds Buy on

rates and

better tone

corporate bond market.

are

Predicts

"roaring bull market" and advocates middle-of-road
ment

position,

the

investment

our.

The Investor and the News—A. Wilfred

Our

invest¬

balance

uneasy

achieved

spot

shortages, in manpower and
frictions and
delays,

the trend

questions

of stock

/ •;

the outlook
are

capacity

extremely

—Nicholas

means

12
13

total

and

military

de¬

of business.

trends

war

scares

price

over

con¬

siderable

range; municipal
shown
sharp

bonds

changes] in

yield within short periods of time;
stocks

common

show

such

episodes

,/Vr

■

The

observers

tendency

economic

the

—David Morris

sig¬
cold

matters

the

work, rather

problems.

interpreting

our

investment

which

years

last

form

Incorporated

•

another.

Secy. Snyder Forecasts $7*4 Billion Deficit in Fiscal Year 1952__ 16

specific about the
therefore, my observa¬

will

reflect

defense

and

the

view

Benjamin Graham to Discuss Security
Analysis.-—__________

that

foreign aid

But

grams of our Federal Government

(Boxed).

Savings Bonds Subject of "On Trial" TV

Forum

visible.

What Nis

appraisal

the

government
are

the

evidence

these

with

policies will
obliged to weigh
presently available

and

view

questions

arriving at some
fairly specific conclusions. As time
a

passes,

obliged

we
shall be
review the situation
again and again, revising such con¬

clusions

course,

general terms and

detail.

for

the

fiscal

June 30
the

ending

year

should

second

Man's

Bookshelf

Canadian Securities

half

the

to be for a fairly
strong business situation, with an
year or so seems

address

Annual

Mr.

Murray

Trust

the

and Banking Confer¬
Jersey Bankers Associa¬
tion, Asbuiy Park, Nov. 14, 1951.
23rd

ence

housing

year.

:____________________

________________

haps
year's

construction

aggregate
crease

will

Inventories

are

not

materially.

relaxation

Washington Ahead of the News—Carlisle Bargeron

the

year

News About Banks and Bankers.-..

to 10%.

Rising

Observations—A.

Wilfred

May___

Exchange PL, N. Y. 5

Reporter

Prospective

the

progresses.

MACKIE, Inc.

Our

this

Governments

Security

Offerings

Public Utility Securities.

Railroad Securities

Securities

Salesman's Corner
Now

Registration

The

Security I Like Best

The State of Trade

incomes

page

Baker-Raulang

Securities

Air Products

Collins Radio

ac¬

further increase of 5%

Continued

HA-2-0270

Teletype NY 1-1825 & NY 1-1826

Our Reporter's Report

inflationary

consumer

Singer, Bean

NSTA Notes

■

per¬

high level of business

Chemical

44
30

Funds

and Industry..

tivity, with industrial production

showing

West End

Indications of Business Activity_s._—

likely to in¬
These conclu¬

Sterling Oil of Oklahoma

Mutual

Nevertheless, there is in prospect
very

prob¬

the New

Einzig—"British After-Election Prospects"
From

suggest some diminution in
the capital expenditure boom and

Corp. "

Greater N. Y. Industries

sions

Steel

re¬

early

in reduced volume,
15%
to
20%
below
total.

Porcelain

Dealer-Broker Investment Recommendations——____________

Residential

ably be

pressures

The Present Outlook

*An

___________

Coming Events in Investment Field

calendar ;.;

substantial deficit will

months

Manufacturing Co.
Baltimore

Business

approximately
cash basis.
During

Cover

____________

to the present level after the

some

The present outlook for the next

Philadelphia and Los Angeles

___

Bank and Insurance Stocks____—

tive
in
about
its
present form
throughout the year, is tremen¬
dously productive at high levels
of economic activity.
The budget

strength of inflationary pressures,' quarters.
;' C--7 »'■
the
demand for and
Plant and equipment expendi¬
supply of
capital funds, the factors affecting tures by business should continue
corporate profits,
and the role at a very high rate even if not up

Teletype NY 1-3370

Direct Wires

Artkraft

which accentuates the poor results
of the September and December

play.

BO 9-5133

Regular Feature*

JAs We See It (Editorial).—

which will presumably be opera¬

the

which

Broadway, New York 6

pro¬

year, a

J.F.Reilly&Co.

24
*

flect in part the increasingly un¬
even distribution of tax collections

for

nosis of the economic situation on
the basis of the facts at hand and
involved

outlook,
the

likely, to

one

being

tions

priority must be given,
therefore, to the analysis or diag¬

now

Remington Arms
17

war

balanced

■

] j: Top

trends

Morgan,

than

their .impact

Minute Maid

Over-the-Counter Industry Profit Margins Are Inadequate!

their

the

appraisal

factors

Hoving Corp..

probable
trends.. Most of the disagreements
seem to originate from
basic dif¬
ferences

Wilson

Outlook for Your Dividends—Charles N.

Middle East Oil and Product
Availability—R. G. Follis

are firm and
continuing elements
follow in the economy. It seems reason¬
unpredictable patterns of behavior. able to
suppose that such expendi¬
As
usual, there are widespread tures, will
aggregate $55 to $60
disagreements among competent billion in 1952. Our tax
system,

characteristic

sensi¬

the basis that

nificance in the waging of

Gold—Just Another Commodity—C. E.

influ¬

of limited

are

;

and so-called
seems

Over?—Bradbury K. Thurlow

Should Have Free Gold Markets
—Sen. Patrick A. McCarran

subject

the

Is the Bull Market

Fresnillo Corp.

individual

are

time

ble to look ahead

longer rigidly
*
pegged; mortgage loan rates have
stiffened; corporate bonds have

and

in
....

"peace scares," but it
Roger F. Murray

have

time

ences

bond

fluctuated

conditions

frorh

markets. Gov¬

are

de¬

Economic

all

•

ob¬

variations in the

wide

will

lines

portions of the
investment

prices

activity

tails

move¬

ernment

Relatively minor changes
comprehensive measures of

economic

scure

possibilities of
in

Circle Wire & Cable

U. Cobleigh________%.

exist

ments

___

;—Roger W. Babson__

because

wide

Primary Trading Markets

Independent Federal Reserve System!

—Aubrey G. Lanston

mands;

there

Let's Have

difficult problems

civilian

in the

YORK

__________

The Retired Old Age Problem-

years

Molodovsky

Expanding Your Income-^Ira

been

for

NEW

WHitehall 4-6551

tween

than they have

number

Activity—Roy A. Foulke

and Reasons for Recent Reversal

administering the machinery for
allocating available resources be¬

urgent

WALL STREET,

Telephone:

Stack Prices

Outlook for

somewhat

Full utilization of

materials,
and

the

productive

These

Street
■

our

prices.

Wall

Obsolete Securities Dept.

Strength Lies in Strong Economy and Alert Citizenship
Shield
:
:

—Lansing P.

obsoletes!

—

Broadening the Market at Broad and Wall—Ira U. Cobleigh

no*

naturally

sell my

relate either to the trend of inter¬
or

May

•

price structure.

rates

Outlook for Our Economy When Defense Program Ends
—Lawrence C. Marshall
i
r

problems in the current economy
est

—

(Whither goest thou?)

Business—Raymond Rodgers

Facts and Forecasts of Economic

Most

Murray.

—But

What Lies Ahead for

QUO VADIS

______Cover

Investment Problems in Current Economy—Roger F.

likely,
New York banker holds problems center about: (1)
appraisal
of inflationary pressures; (2) demand and
supply of capital
funds; (3) factors affecting corporate profits; ^aud (4) role
of government policies. Sees,
however, immediate strong business
situation, but looks for strain in cash position of corpo^
rations and rise in commercial
borrowing, with firm interest

Balance—Henry Ansbacher Long

Tomorrow's

Markets

Dictograph

(Walter Whyte

Says)_.

Washington and You

Di-Noc

36
Published

The

Twice

Weekly

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and

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Reentered

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London,

the

under

post

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office

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New

March

Works

1879.

to 9576

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DANA

SEIBERT, President

RIGGS,

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Thursday, November 15, 1951

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(1840)

RODGERS*

production, aside from military output, as most

increased
tastic

fan¬

and declining spending, and says heavy
"first class headache in many lines." Warns,

are

eliminated. Looks for suffi¬

however, danger of inflation is not

Criticizes current taxation.

Production

fol¬

History will undoubtedly record made up of increases in the
reversal of the inflationary lowing factors:

trend

last

March

The

brightest
hour.
with shortages
of

capitalism's

Russians,

'•

basic

the

war

effort.

The inflation indicated by these

ers and adding it to the $122 bil¬
increases,
while
substantial,
is lion paid directly by the corpora¬
considerably less than is generally tions, the total for the owners be¬
thought. But what is most impor¬ comes $42 billion, and for the

tant/ since

March

this

year,

.agricultural prices, raw materials
prices and wholesale prices slowly,

the

actual relation

parently
consumer

reversed.
As
for
prices (cost of living),
this group did not de¬
was

although
cline, as did the other categories,
the

increase

the

consumer

in¬

government $140 billion, or nearly
3V2 times as much, and since then,
taxes have been

Now,

add

deadening,

wasteful

business of the
and

the

need

greatly increased!
this the

urgent,

for

emergent

yes,

revision

tax

warpipg,

effects
on
profits tax,

excess

cannot

denied by any honest, fair-minded

____

back

Expenditures

which

crease—of

stheir almost
complete lack

billion

$65

this

Naturally

you

will

58%

fact,

in¬
note

the

pre-Korean

high, in
inflated rate. Or, take the

rate, but that

11
Inventory Investment-—_ 14
(plant and equipment)—

living, to say

was

a very

announcement that steel quotas in

the

fourth

range

from

11% for stores, garages and

ware¬

quarter

March, that was but one victory
a continuing battle.
It was only

in
a

"for the time being" proposition.

As the higher October prices in¬
dicate, the danger of inflation has

by no means been eliminated.

In¬

tific

method

least

little

taxation

and

categorical

in govern¬
imperatives

if American progress

is not to die

ment

are

economy

"a horning!"

In fact, as

good

our

billion came from re¬ houses, through 26% for non-de¬ creasing inflationary pressures in friend, Captain Henry Heimann,
head of the National Association
armament
spending — caused a fense
industries, 40% for schools the months ahead present new of Credit
Men, so trenchantly, put
sharp upward trend in practically and hospitals, 43% for roads and dangers which must be carefully
it last month, "If there were no
all economic factors.
59% for oil to 100% for aluminum watched and combated by every
hope of lower costs in government,
measure possible,
V
then there would be very little
Reversal of the Inflationary Trend production facilities — these are
percentages of the steel requested!
hope for the type of government
Taxes
Well, what happened to stop
only

of/.consumer
durable goods,

should ponder

this "made in
America"

materials

Subtract¬

ing

(In Billions)
person.
of these cutbacks to normal de¬ dex since March has been of ex¬
$18
In any event, one thing is cermand.
For example, stoves, re¬ tremely modest proportions.
2
tain::. this situation cannot continue
Even
though the inflationary
frigerators, radios and most house¬
18
indefinitey—it will break down of
hold
appliances have been cut trend was definitely reversed last its
Foreign Investment-__
2
own
weight. A more scien¬
.

Capital

their very low

production dur¬

quarter and the early
months of 1952, it is very easy to
this

misunderstand

Spending
Other Govt. Spending
Personal Consumption

consumer

nothing

fur¬

additional

this $18 billion from the $60
billion received by the stockhold¬

plans

received

$18 billion in revenue.

17%, leaving a net
increase of only 29% in the raw

Defense

goods neces¬
sary to
sup¬
port even
standard

Increases

cutbacks

ther

ing

the

Authority

ernment

later declined

'but almost continuously, declined
While it is true that the National until October, when the trend ap¬

comparable 1950 figure!

goods, despite heavier military expenditures.

cient non-durable

per,

—

Sees paradox

achievement of the American economy.

raw

the problem—even in con¬
sumer durable goods made out of
scarce
metals
has
been, "too
much
and
too
early!" In fact,
other than automobiles, which are
somewhat less, the inventories of
consumer durable
goods jare two
to three times one year ago with
the exception of television stocks
which are around eight times the

of increasing income
inventories

sonable to conclude that the gov¬

But since

then,

last March "as

trend

materials, such as cotton, cop¬
wheat, etc., shot up 46%, it

would

period

build-up

"too little and too late!"

Rodgcrs, commenting on reversal of inflationary
capitalism's brightest hour," points to

Professor

Using the very conservative as¬
sumption that such stockholders
paid an average rate of 30% on
the $60 billion received, it is rea¬

fense

School of
Administration, New York University

Professor of Banking, Graduate
Business

Thursday, November 15, 1951

particularly ironic. As you will 17%, have declined 4%, leaving
recall, until last March, it was a net increase of only 13% and,
generally thought that the inven¬ while it is true that the very
tory problem throughout the de¬ sensitive index of 28 important

What Lies Ahead for Business
By RAYMOND

...

eco¬

nomic miracle.

$18

we
have."
Or to put it in other
Agriculture
Any estimate of the future must
words, the very future of democ¬
agricultural front, with give due regard to the impact of
racy depends on its ability to sub¬
an
overall production equal, or taxes, as they have become so
staggering that they should give American
stitute self-discipline for political
capacity to produce!
exceeding last year's crop, which heavy that they have a great ef¬
the "Russians
pause
in their
expediency, i.e., to trim its dreams
While
thef Federal budget cash
fect on business developments. In
was the second highest on record,
demonic dream of world domina¬
to fit its means!
surplus of $7.5 billion, the vari¬ the
problem is also that of sur¬ 1950, Federal, State and local taxes
tion/'; Certainly, the implications ous credit restriction measures
The Outlook
pluses. With most of these totals, rose to the enormous total of $54,could hardly be more reassuring
such as Regulations W and X, the
such as cotton, wheat and corn, 676,000,000.
Since then, Federal
to the peoples of the free world,
In the coming months the busi¬
Voluntary Credit Restraint pro¬
taxes have been sharply increased,
you are quite familiar. But it may
as
no
one
could have expected
ness pattern will be characterized
gram of lenders, particularly the be of interest to take a closer look and indicative of what we may
that America could carry on the
by widely divergent trends be¬
commercial banks, and
the re¬ at fats and oils, and cattle. /:
expect from Washington in the
War in Korea, rearm for defense,
cause the rearmament effort with
moval of the fixed peg on govern¬
In fats and oils, we face a seri¬ future. Elmer B. Staats, Assistant
aid the free world, maintain the
its increasing billions of expendi¬
ment bonds, all contributed to the
ous over-supply.
Director,
testified
the tures will
With 70% more Budget
highest standard of living in his¬
assume growing impor¬
reversal, the main reason was the cottonseed oil, a near record sup¬ other day that in fiscal '53 Federal
tory, and, at the same time, pro¬ realization
tance in the economy. Those pro¬
by consumers that the
Budget expenditures alone would
ply of soybean oil, and the second
duce so much goods that inven¬
defense
materials
and
supply of goods—even of con¬ largest output of lard in our his¬ mount to between $80 and $90 ducing
tories could be built up to such
durable goods will have an in¬
sumer
durable goods—would be
tory, such a conclusion seems in¬ billion. In addition, he said that
high levels that an "inventory re¬
creasing problem of shortages of
adequate
unless military pres¬ escapable.
even
after the completion of the
cession" could result.
But that's
metals and other commodities and
sures greatly
increased. This be¬
As for beef, that economic prob¬ rearmament
program,
Defense
exactly what was done!
v
thus will face stricter allocations
lated recognition gave rise to a
lem-child of the Washington plan¬ Department expenditures of $40
and more and more government
paradox
unparalled in > modern
ners, the outlook is not so clear- billion a year should be antici¬ controls
"v
The $65 Billion Boom
and
assistance, if they
economic history: In the face of
cut, although powerful long-run pated!
( To comprehend the utterly fan¬
are
to maintain full production.
sharply rising consumer income, factors are working in favor of the
Too heavy reliance of the Fed¬
In sharp contrast, however, to the
tastic character of this achieve¬ consumer purchases actually de¬
eral Government on the income
consumer. Most important of these
feverish activity in the defense
ment of the American economy, it clined. More specifically, consumer factors, the cattle on farms will tax for the production of such
and
durable
goods sector, soft
income increased about $5 billion
have
increased from 84 million enormous revenues has created a
is necessary to look back of last
goods producers may expect keen
on an annual basis in the second,
head at the beginning of this year dangerous fiscal situation. For ex¬
spring. When this is done, it is quarter of 1951 hut consumer pur¬
competition.
to probably more than 90 million ample, in Canada and Great Brit¬
As you will recall, from 1941 to
Quickly seen that from the first chases declined some $6 billion.
by the end of the year. This herd ain income taxes, as a whole, ac¬
1948, soft goods producers, in gen¬
This paradox of increasing in¬
quarter of 1950 to the ; second
build-up of six million head has count for about half of the total
eral, enjoyed a strong sellers' mar¬
quarter of 1951, our economy, in come and declining spending has been one of the biggest supporting revenue; but in America, income
continued up to the present so far factors in the current high prices taxes, which produced only 42% ket. Profits were higher than ever
addition to its "normal" load, car¬
before
and
many
uneconomic
as can be told from the informa¬
of
beef, as approximately one- of Federal revenue in 1939, are
ried a boom of some $65 billion,
characteristic of ? such
tion available.
This development sixth of the 1951 production is be¬ expected to produce 83% of the practices,
lush markets, developed. But from
is of great significance to business ing used for this purpose. If feed total in fiscal 1951-1952!
*An address by Professor Rodgers at
the
Economic
Personal
income
taxes
have now on, despite the huge rearma¬
Meeting,
The
Bank of as the trend can be reversed very production continues heavy, and
ment program, these non-durable
Virginia, Richmond, Va., Nov. 7, 1951.
quickly if the military outlook if cattle prices continue high, this reached such high levels that if
worsens to the point where World
herd
build-up may continue to, the government taxed at a 100% goods industries will operate in a
more normal market with supply
War III appears unavoidable.
say, 100 million head by 1954 or rate (expropriated) all of the re¬
often exceeding demand assum¬
In addition, of course, past sav¬
1955, but inevitably the rate of maining individual income of peo¬
ings can be called on. In fact, one growth will be slower than the ple earning above $10,000 a year, ing, of course, that all-out war
will not develop. Competition will
of the greatest economic dangers six million
the yield would amount to only
of the current year.
be keen and the price factors will
of today is the extreme liquidity
CLASS "A"
A
weakening
price
structure $3.5 billion, according to Professor
of the various forms of savings would, of course, completely re¬ Lutz; or, if they taxed at 100% all once again play a controlling role
A dividend paying growth
in the success of such producers.
held
by the American people. verse this trend and beef would such income above $25,000 a year,
opportunity in Crude Oil
This means
that the
deadwood
Estimates of the purchasing power flood the market. In
any event, a the yield would be less than $1
which might attempt to come to larger proportion
Information on request
of production billion!
market oyernight place the total of
Corporate income taxes have
larger herds may confidently
above $200 billion, which gives an be expected to come to market in become just as onerous, and just
GENESEE VALLEY
idea of the economic danger in¬ the future. This is the first good as unfair.
Thus, in the ten-year

Raymond Rodfers

;The: implica¬
tions

are

^SENEGA

trend last spring? The
be put in a nutshell:
Consumers regained their faith in

the upward

can

answer

On the

COMPANY^

OIL

SECURITIES CO.

Powers Bldg.,

volved.

Telephone LO 3190

Teletype

BO 87

the

J < Placer Development,
jLimited
LEAD—ZINC
;

present

TUNGSTEN-OIL-GOLD

situation

very

request

Business
than

John R. Lewis, Inc.
,||

1006 SECOND AVENUE

SEATTLE

Teletype SB 105

ELlot 3040

distributed
.

Prices

follows:

inventories

$70 billion

member
too

large

respect,

ways a

will
in

expected that this

company

haves

earnings

its

less

are

first

class

have

skyrocketed

Day is

since

Korea

good example of the fal¬

the

dubious

distinction

"own¬

than

weren't consumers' prices have increased pay via their own personal income
too small?
In this only about
8%' 'and wholesale tax return when they report the
present situation is prices,
after
having
increased income received on the shares.

largest

but is selling
1946

its

Latest

1/3

high.

Dividend Meeting on November

15th

information

upon

request.

Moreland & Co.

ing" the enterprises!

many

the

history

part of it is caused industry, largely via the income
by false impressions of price reali¬ tax route, more than twice as
ties. The current belief that prices much as the stockholders who had

time when they

the

COMPANY

Federal,

State and local income and excess

But this is not the whole story,
lines. But, lacious notions that people often
for that matter, aren't inventories have on price behavior.
it does not include the double tax¬
Since the Korean involvement, ation which the stockholders must
always a "headache?" Can you re¬

"headache";

L. A. DARLING

considerable

spending.
Inventories

available

have had for

Prices, like inventories, are al¬ profits taxes, $122 billion, or 46%;
sore spot in the economy. retained as working capital, $82
There
are
carefully for clues as to future
always large groups billion (of which $21 billion was
business conditions. The thing to dissatisfied with prices no mat¬ inventory
appreciation and not
keep in mind is that such develop¬ ter what level
prevails. While actual profit); and stockholders'
ments will not only determine the part of this dissatisfaction arises dividends, $60 billion, orf 22.7%
level
of
debtor-creditor
and
government
spending, from
pro¬ of the total. Thus, on a groins basis,
they will powerfully affect con¬ ducer-consumer
relationships, a government took out of corporate
sumer

Analysis

con¬
period 1942-1950, inclusive, cor¬
long time. porate profits of $264 billion were

from the beef front that

sumers

consumer

international

t
'

news

saving
trend, businessmen should watch
the

unprece¬

liquidity of past savings
the possibility of a reversal

and

of this

Because

dented

Rochester 14, N. Y.

Members:

Midwest Stock Exchange
Detroit Stock Exchange

1051

Penobscot Building

DETROIT 26, MICH.
Bay City

Muskegon

Volume 174

Number 5064

The Commercial and Financial
Chronicle

(1841)
and

extravagances

born

too-

easy times will have to go.

Many businessmen in the field
relying too heavily on the
hope that the decline in the out¬
put

will

cause

durable

consumer

Steel

The

are

spilling over of the
disposable income of our
people into the soft goods field.

Retail

(1)

and

Commodity Price

large.

soft goods field

has

been

greatly

increased.

(3)

Only

will

diverted

the

Steel

defense

101.1%

<Looking

durable

than

goods

'.market

with

will

before.

ever

;inevitable.

face

for

menf" which
since

the

business

end

has

that

ca¬

increase

Re¬

,.L- Conclusions>
the assumption that all-out- :

will not

materialize,; my
elusions, in brief, are:-.

tonnage, the gain amounts to 2,000 tons

mildly
of

steel

pressures will continue to mount
in the coming/months. The* extent
to whichthey " will be

banks.

■*

■

Despite

durable

consumer

The

(3)

ahead

unless, of
(4)

Too heavy, reliance

endangers

the

stability of
the government: and
damages the
economy because it is unfair and
destroys initiative.

(Special

to The

Financial

SARASOTA,
has

been

added

Although
curbs

staff

Financial

Mathews

Co.,

;

State

snow

some

already brought rural collections of

,:r-

Investment

Approach

which

con-;

of
public -interest with
rising
politics, edi¬ prices leads to our primary af¬
sports,' Obituaries,; firmative, precept;. (1) Maintain a

scrap

bearing

will

on: the

But there

such

secondary; only in

reader

get specific,

and

assuredly

coverage of the

concen¬

complete

happenings he

investor human being must not
miss.
.!/■'*:' '
1
i.

believed

this

softness

there

automotive

production

the

United

States

the

last

week.

were

Lincoln

and

Hudson

responsible for

were

down

for

the

items

are

dend

worlds

companies,
action

and

course

items

ranging

bonds

cies,

and

future

past

their

divi¬

thousands of prices

from

stocks,

international

curren¬

basic commodities and
prices of farm products

there

And

that

most

popular

phenomenon,1 the

stock table—a
tabulation, either in whole or in
part, of the. stock market's trans¬
actions, along with news and edi¬

the

torial comment thereon.

model

ther

say

this

October

saw

on.

offered

indices,
•

wealth

period, ^

increase

the

durable

goods

one

drop in non-durable goods output.

index,

which

offset

excitement.

While-

interest

prices and volume, if anything the
converse is, of course, a more
logi¬
cal

course

the

found

Reads

for the potential buyer

the reader

specific

the

conducted by;
large metro¬
ago.

years

following

degrees

talk

given to the
by

Mr.

Mav

investment

Although the financial pages of
the dailies may well be read, the
newspaper

the
the

should not be read jor

financial

general

Consider

section.

sections

neWs

in
New

York

Stock

Exchange

ment expenditures reached

New

York

Curb

Exchange

income

York

Cotton

Chicago

Board

Exchange

Exchange,

Commodity

Inc.

respective

before

ticular
Take

condition

the

morning

February.
Steel

Trade

hound
news,

for

after-the-close

feverishly

published

And

other -Exchange*
:

N. Y. Cotton

Exchange Bldg.

DETROIT

GENEVA,

PITTSBURGH

SWITZERLAND

new

editions.

...■

(2) Distinguish sharply between
and

interpretation.
are

fundamen¬

and constructively
useful;
while the editorializing, including
the forecasting,

is only of second¬

importance. In your reading
activities, as elsewhere, maintain

ary

long-term

value-appraisal in^
indulging yourself jn the
more enjoyable immersion in fore¬
casting discussion.
a

stead of

vantage the psychological clues in
the market place.
observation

With intelligent
in - proper

employed

perspective, one can detect the
many foibles in which the finan¬
cial
community recurrently in-*

1951.

Continued

page

STATE AND MUNICIPAL BONDS

high record, and that personal

the

first

monthly

decline

CORPORATE BONDS

since

LOCAL STOCKS

Output Scheduled to Advance Mildly This Week

NEW YORK 4, N. Y.
CHICAGO,

showed

oping, in demand,, chiefly from consumer durable goods lines,
which give the market a
spotty appearance. .This, is reflected in
several ways, such as conversion deals,
especially-in sheets, which
are on the decline.
Shipments on defense account are improving
and premium prices on
gray market and imported steel are being
shaved, while increasingly larger steel tonnage is being diverted
Continued

page

The

Robinson-Humphrey Gompanyjnc

RHODES-HAVERTY BLDG.
;

hot

be¬

tween the baseball and horse-race

EST. 1894

Over-all pressure for steel continues
unabated,, sa.ys "Steel,"
ythe weekly magazine of metalworking.
But soft spots are devel¬

; New.1 Orleans Cotton, Exchange
**{.

September

market.

once-a-week

attitude toward Stock Exchange
price changes, in lieu of being a

Adults'

School of Montclair, N. J., Nov. 13,

■

important, irrespective of the par¬

highlights revealed that total new construction dropped
October, estimated third quarter non-farm plant and equip¬

ap¬

proach.

(3) Try to use for your own ad¬

attention

genuine

tally

figures

two

data

What?

survey
nation's

dailies

with

Other

Members.

cus¬

tomarily rises along with market

that facts

production.

politan

219% in Septem¬
in April, at 223% of the

output

un-

periods of rising and
speculative activity, .and

Realize

fur¬

automobile
production,
business
construction, railroad carloadings,;
oil production, department store

Who

A rise in machinery output, the board said, caused

finan¬

with

succeeding
falling

factual

weekly

A reliable

estimated

was

the

Treat

bit

;V.v-

On the business side,

industrial

1935-1939 average, compared with
The high point for the
year

section,

I'll have

sales, electric power, and iron and

month

content of

changing attention throughout

and

side,
about .specific

earnings;-about

business
finance

including

the

plainly visible this week.
caused by government

users'

the

finance.

But signs of softness in the coldare

cial

attitude

phlegmatic

the

'.,v--V°

recently

and

toward

indirect

steel

base

New

-.h

This reference to the correlation

society news on occa-; stable'
there will be items having

trated,

standstill,
industrial scrap sources, which may not

ber.

H. Hentz & Co.

•

How to Read—From

even

zine

parts of the Mid¬

production reach its
highest level since June, according to the Federal Reserve Board.
The board's preliminary estimate for the month was 220% of the

1856

uncertain.

world

itself will the newspaper or maga¬

government

year,in history, "Ward's" said.* In the year to date,
6,075,000 cars and trucks have been built, compared with
7,039,000 for the like period of 1950, the record year. A new high
in truck output will be reached this
year, this agency predicted,
and car output will drop 25% to 30% behind 1950.
The

that

Further

quite assured; from

seems

the latter

newspaper or

about

•"

tion of the mutual funds.

est production

;

arising from the interven¬
ing bull market and the distribu¬

source

the financial and business section

Chronicle)

Established

with

effect

Mercury's Metucnen and St. Louis plants to recoup the loss, the
agency added.
'■//
v.'-'■■■■• •>■! V

;

realized

world of finance.

United States plants will probably achieve their second
high¬

BOSTON, Mass. — Thomas F.
Noble has joined the staff of Ed¬
Street.

periodical

cerned

some

changeovers; Nash was idled by the effects of the Borg-Warner
strike; and Chevrolet assemblies were halted at Flint on Wednes¬
day, the 'past week, because of bad weather. Snow storms also
stopped Mercury production at St. Louis around the middle of
the week, but production has been
scheduled near the close at

ward

scrap

Suspensions by six auto producers

AURORA, 111.—Harold F. Wrigley is now affiliated with Schwanz

the

News •|

section of the

sion,

this trade journal.:
and other industries, widespread

With E. E. Mathews

should

every
other

and

slightly, while passenger car output alone was off
mildly, but registered a drop of close to 29% below the similar
period of last year, "Ward's Automotive Reports" stated.

Company, Inc., Merchants Bank
Building.
v.-

read it?

taken, because of
subsequent enlargement of
public's interest in common

' future stimulation from theformer

section?-/

torial: opinion,

hedge

as a

demand, it is spurring producers to give
to their future markets, "The Iron Age" concludes.

decline

to The

•

week advanced

Carnes

(Special to The Financial Chronicle)

(Special

bleak, according to

Cold weather and

steel

Total

Joins Schwanz Co.

;

outlook is

rolled sheet market detected

Goodbody & Co., 203 South Palm
Avenue.

productivity plan might be used

eight months—possibly longer.,

Chronicle)

the

In that section of the newspaper
he gains access to the day's news

eye

Fla.—Lee

stocks

and

Staff

items.,

news

•

(4) How not to read it?

.It

; Steel
producers are still in the midst of a sellers' market.
And it is expected to continue
strong for at least the next six or

fiscal

Goodbody Adds

A wage

putting added pressure
be equal to the task.

the

.'■f'Nature of the

orderly retreat by government stabilization officials.;

scrap

west have

of revenue

source

this survey was

the

and

stocks down.

materializes.

income tax

the

people feared has happened.
In some sections of
the country, winter is
here, and mills have been caught with their

decline,
another buying

....

What steel

should, in general,

course,

(2) Who reads the financial

persuasion,
have barely managed to
keep steel furnaces from shutting down.

be stable, or even tend to

panic

finan--

industrial

May

(3) How to

are

publicity of the need, and full force

Prices of commodities in the

months

business

and others will follow during the next 18
time annual capacity will total close to 120

The great efforts of steel,

will

goods

;

The Congress of
through the wage
with: the. United Steelworkers of America-leading the
assault," this, trade;paper observes.:,; ;•2)*; I
VVvyv- -v

to permit an

solve the problem in most lines.

news

financial
A. Wilfred
.

Washington .pleas for, temperance,

increasing cutbacks in production

inves¬

cation

y,\'v.

eost increases.

(2) Inventories are too large,
but growing defense payrolls and

suprising to you that
as many men read the society and
bridge
pages: as
the
financial
news, but this latter apathy has

relevant

yv
If a wage increase is granted, "The Iron Age" states, steel
firms will positively insist that prices must also be raised—not
only to cover the wage boost, but also to cover other cumulative

■';

Bridge-

•4

Treasury borrowing placed in the

—

and

will been
existing' for a very long
-Finance
briefly cover:: time.
reading has no
(1) Specifi¬ doubt measurably increased since

Industrial Organizations is determined to break

mands and the amount of
any new

26%

It may be

reactions

the

cial

7 ceiling,

check will depend on what is done
about the forthcoming wage de-

Society

follow¬

the

Female

60%

Editorial

thoughts

Circulation

Sports

Financial

tor's

of Male

Women's

ing

Proportions

esdment

The

ago

months, by which

■

Read by
Following

of Paper—

practice.

potential roadblocks which could delay
the production timetable, it
notes,;.;"
; :
^
:
-

■

kept; in

weeks

Labor and scrap

(1) Production checked infla¬
tion last Spring but. inflationary"
.

two

n v

sex.

Department

principles and

point.
the pre¬
a

over

part and

are

d a

was

million net

corn-

media

news

by its readers, classified

according to

parcel of fun-

year, this trade authority states, the steelmaking
in 1944, the peak of World War II, when
output totaled
89.2% million net tons, equal to 95.5% of rated

high

•

shortage-

capacity.
member, this great productive caI ;* / -From now on the advantages of steel's
early start on defense
opacity checked:, inflation .' last •W
expansion will become more and more apparent... The first new
March; don't underestimate it!/ ;■ steelmaking facility started since Korea poured its first heat of

war

use

rise

0.1

sections

and

civiliaiv goods.

scheduled

point out as under¬
discussion, that one's
financial journalism

Prior to last

added

war.

week

reaction

with 96.8 million tons last
year.
To do this, steelmaking opera¬
tions this year will have to
average about 100.9% of rated capacity.
Last year, the average was
placed at 96.9% of rated capacity.

pacity in World War II and the
$109 billion of plant and equip.

this

The steel industry is rapidly building

„

the

great,'expansion of productive

lying

up an impelling case
decontrol, states "The Iron Age," national metalworking
weekly. Production this year, it adds, is expected to total about
105.1 million net tons of
ingots—a new all-time record—compared

This will be the;

consequence

this

capacity, representing

some

offset

vious week.

buyers'
keener

competition

production

In terms of

little further ahead,
once the
rearmament program is
| complete both durable and non,

want

items,

news

comparative readership of the

financial and other
sections of the daily
newspaper.
Offers suggestions of atti¬
tudes toward current journalism to follow and to
avoid, to
conform to sound basic investment
principles and policies.

Business Failures

created declines in the manufacture of

effort.
,

the

Production

steady rise in defense output which continues

insignificant part
of the total, output of soft
goods
an

May cites the relevant financial and industrial

and

Index

;The decline in country-wide industrial
production last week
was almost
imperceptible/ although output still held well above
the level for the comparable
period one year ago. An important
factor in maintaining the nation's
high production level was the

(2) Productivity capacity in the

Index

Price

Auto

Industry

Mr.

Inventories in the hands of
are

By A. WILFRED MAY*

Trade

Food

Although this will happen, and
business will improve, three facts
,should be kept in mind:
consumers

Output

Carloadings

State of Trade

goods

rising

The Investor and the News

Production

Electric

* WALNUT 0316

ATLANTA 1, GEORGIA
LONG DISTANCE 421

The Commercial and Financial Chronicle

By LAWRENCE

While the American

Ends

C. MARSHALL*

Manhattan Co., New York City

less

ties

economic

Our

able period of time, but

ifailed

discover

antibiotic

.which

have

planners

been hard at work for

will

tion

lent

level of

chemistry, agricultural production,
and. medicine, with its far-flung

the
of

production.
v
The years
since

span

extended

of life, population growth
bigger markets in the future.

wit-

plunger,

historic swing in Britain

buyers

will

dynamic capi-

require not only initiative at the
research and industrial levels, but

mate¬

this

Insulls and Hopson is now illegal,
and (5) there is a highly impres-

side of the At-

sive list of companies whose shares

exploit these opportunities

talism

we have paid dividends for uninterhope rupted decades..
* 1
Churchill's reAmerican Telephone and Tele-

[antic,

fondly
turn

augurs

each of the last 32 years; several
hundred companies listed on the

some

have

Foreign Investment

Results

Essential

have paid

Exchange

Stock

tapers

Planners Cannot Produce

$9 dividend in

has paid a

graph

real departure

dividend for at least 10 years;

over the
random from
outfits whose dividend record has
been pleasingly persistent. Cornmon stocks have now become not
only financially correct but so-

and just cast your eyes

list below selected at

daily acceptable! '

;-y

late, " Steel nationalization may be. Common Stocks That Have Paid
suspended, and some motor trans-;
for Half a Century or More *:r

•

Another field which offers greatthe planners should
port restored to private ownership,, ,'
No 0f Years :
'
W- some dm1950
develop- unusual acu¬ opportunities for development and;- but coal, railways, and banking
dend has
Payment
occasional in¬
should * provide vast- outlets for will probably never be privately'
men, there is reason to doubt that
been Paid Per Share
Lawrence C. Marshall
terruption, by
they can effectively insulate our American investment in the form run again; and even if presently, cl™nd E]ectric Illu_
50
$2.40
intense
ecoof
capital equipment and tech¬ given opportunity. to buy back
;
economy from any decisive turn
minating co.
2.75
50
nomic activity, by sharply rising in the economic tide. Any depres¬ nical "know-how" lies in the less, SOme sections of State-Owned in- Hartford Electric Light
2.80
51
incomes,
over-full
employment sion in an economically important well-developed areas of the world dustry, capitalists will surely hesi-/®^^ EiectriTx^Z: 3.80
52
2.80
53
and, unfortunately, by one of the country can easily and quickly be —especially in the countries of tate—so thin is the thread by Boston Edison
Both which Churchill's regime holds united States Playing
biggest inflationary sprees in our communicated to other nations, for the Western Hemisphere.
6.00
55
Card Co.
history.
That we can travel this the gold coverage of currencies to the north and,'to the south of power,
3.00
60
(
Cannon Mills Co.___-i_
1.60
60
inflationary
road
indefinitely in* 26 countries has dwindled to us are good neighbors with rap¬
Well, we owe it to ourselves to- Commonwealth Edison_
3.55
60
without, at some future time, suf¬ 15% of their total money supply, idly
growing
populations,' -vast ask how did this all come about?
»nd u*mbie_. _
fering severe and difficult re¬ whereas before the war the figure natural, resources, and large po¬ How did the nation, that for a" Ne& Tefegraph6 eP._°!!!
6.00
65
5.00
69
To foster century was the prime capitalist standard oil of7N?j"I
adjustments,
is
a
theory
that was something more, than 40%. tential labor forces.

f been

•

marked,

with

•

and

World
II

War

implications

have

prices

volume

electronics,

ment,

back

develop¬
metallurgy,

power

weeks

from "crib to
arises when military equity money to fixed income se¬
Ira U.-Cobleigb
slab" Socialreasonable
balance,
off is of the curities in
will it be possible to move for¬
-,
ism, a real regreatest consequence.
But of one
ward with maximum safety. Here turn to an economy based on inithing we can be reasonably sure
—if our private business and fi¬ is a real challenge to the financial tiative and enterprise. We would
nancial system fails to act with community—to help marshal the like to see' expanded production,
funds
in
acceptable- form that rather, tha'n free false teeth and
courage and decision,: the leftists
to pace its eye glasses, as the major goal of
and the radicals will use the occa¬ industry - will; need
.*'
!• ; :
sion to take another step down progress at the research, engineer¬ British economy.
But let's-face it—perhaps it's too
•
the road to a socialistic economy. ing- and production levels..,

which
production

the

and *■ in

few,

two

gap

readjust-

ments

•

only

fields—to men¬

range

there
are,
today,
10
for
investment income,
from the Labor Party, and People should take note that (1)
to leadership that inspired pool operators are gone forever,
her citizens (2) shoe string margins are dead,
and preserved (3) the arrival of the SEC and the
her Empire in rigid
requirements for truth in
her darkest security offerings were aimed to
hour.
Natu-^destroy the financial weasels, (4)
rally as ardent dizzy and dangerous pyramid fibelievers in a nancing
after the style of the
last

rializes, it will create problems of in the realm of finance as well.
they have economic readjustment which Industry will need,vast amounts
economic, challenge our resourcefulness to of capital to carry forward these
the limit.
.1" projects and only as we succeed
keeping
the
proportion of
How we manage to bridge the in

vio-

even

revolution
technology, affecting

away

wide

outcome

gestions to that end.
The

consider-

^immunize
i us from sharp
or

that

and no
promising in the potentiali¬
they hold forth.
We are in

in industrial

incapable of preventing economic reversals.
if

less impressive

challenge to initiative

nessed

"Expanding Your Income"

Suggesting wider share ownership as a bulwark against the
Socialism that debilitated England; plus some specific sug¬

the midst of a veritable

well-developed areas of the world, particularly in coun¬
Hemisphere. Says our economic planners

Yet

Author of

replaced

been

other frontiers no

tries of the Western

end.

expanses

has

past,

step down the road to a socialistic economy." Discusses poten¬
tialities for growth and development of domestic industries and

are

By IRA U. COBLEIGH

of un¬
developed land—is a thing of the
unlimited

weighted with defense expenditures, Mr. Marshall holds that
success in bridging the gap will largely determine the continu¬
ance
of our free enterprise economy. Warns if our private
business and financial system fails to meet the challenge,
leftists and radicals will seize the opportunity to "take another

of less

At Broad and Wall

frontier, as

think of it—in terms

used

Pointing out that in not too distant future we will be confronted
with task of adjusting our economy to a basis less heavily

Frontiers

Impressive Economic

When Defense Ptogram

•

1951

Thursday, November 15,

Broadening the Market

the other foreign.

Outlook foi Out Economy

President, Bank of the

and

domestic

fields—one

major

...

(1842)

Even

only

suddenly

;
'

...

______

would be rejected by even a

first-

of this will

What the consequences

development would seem to

their

this planet,

•

residential

and

witnessed
have

construction

this

country.

ever

phenomenal
expansion in industrial plant and
engaged

one

There

wind/
volume

are

fed

policies

with

inflation.
And there
equipment, and we have witnessed are signs in some areas that the
repeated surges of consumer people
are
beginning to learn
buying.
On top of these, we are that
extravagant
government
now superimposing a vast military
spending and artificial easing of

•

defense

with

timing

this

but

•

all

program.

foresee

one

the

assuranec

defense

with

program,

basic

any

preciation of the values of
of life

and

can

exact

will,

soon

*Excnrpts
Marshall

from

before

brought to

the

can,

address

26th

l.»y

Annual

Mr.

Dinner

of
<

the New York Security Dealers Association,
Waldorf
Astoria,
New
York
City, November 9, 1951.

.00

beget

lowering the value of
and the level of
their standard of living.

money

their

ap¬

our way

fervently hope that it

that

are

currency

country the situation
clear to need much

our own

too

all

elaboration.

Whether

can

are

and

Just clip $1
our

live indefinitely

a garrison state without sacri¬
ficing many of our freedoms,
without
further
drying' up the

venture

know,

can

one

capital, again,
but we dare

distant

face

to this advertisement for

via

you

air

mail

(outside

California)—5 full weeks of

IES

just

than

completed,

worth

limit.

far

dustry—both
the

acclaimed

booklet

"PLANNING FOR PROFITS IN THE
STOCK

going to stay on

You Do

propose

material change

war

nor

in the volume

name

timing of

occurs, we
so

—

and address
a

clearly

dollar bill-

today to

will

not

C-95

Barbara, California

expand

new

5.00

lOg

1.00,
.50

102

our

citizenry

about the merits of share owner-

™m

haye

that stocks sell

popular price range;

opppf-split"up^

of the stock
to broaden the stockhold-

the

further.

want to make sure

theory

Olid A. vw

TMItffiifC!

TVAYYI

Her capi-

production.

should have

which

year

for

prepare

Homsey & Co.
■

•

Arthur V.
King has become associated with
Mass.

that has

pottery

Homsey & Company, 31
Street, members of the New

York and Boston Stock Exchanges.
.Mr. King was formerly

ism,

intensively

let's

of the programs
defend

our

with A. C.

Allyn & Co., and E. H. Rollins &

the

; Keith

Mass.

—

Raymond

inaugurated

recently
with ~

fine

State

New
am

im¬

of stockholders.

York

changes.

How

growth

& Co.,

two

regime

Stock

Ex¬

First,
and for

Inc.

Boston

was

meetings
office parties

national
~

Outstanding
or

7th

small
Ave.

million?

we have to dispel,
once
all, the lingering notion—

hangover from 1929—that buy¬

ing stock is gambling.

"fi7.

buying

enterprise from 15 million

formerly for
with Pearson, Erharcl

and

members

banquets

actually increase the
of those who are partners

can

the

many years

his

objective, how do we go about it?.

Street,

pressed with the possibilities for
development

article

largest Hotel

facilities for

foH

Well, granting the worth of our

at least 50

Let's

President of the
New York Stock Exchange, who

our

N. Y/s

offers foremost

Funston,

activities,

well calculated to1
way.
Let

stockholder.

FROM WALL ST.

inspiring leadership of G;

Dabney

(Special to The Financial Chronicle)

5 MINUTES

one

less

pursue

low the

census

Joins Townsend

become

with Townsend, Dabney & Tyson,

proportionately

•

shares in America, and a

track. They're bringing the message of "shares in America" to
Britain/rfarmers,/highly paid industrial

everybody who can save a buck'

will be readjusting to a

and

self

American

number

the

brought

inefficiency.

Farnsworth has become associated

war-related

course

hopeless indebtedness and gross

time

due

by the muddled Marx mythology, and Keynesian fiscal crack-

—

du Pont,

BOSTON,

looking toward

period

So, using Albion as a classicexample in the follies of Fabian¬

defense program

our

became

out

(Special to The Financial Chronicle)

period of readjustment.

when

INVESTORS RESEARCH CO.,
Dept.

is that

Co.

(please print), enclose

Santa

abroad—

than temporarily.

BOSTON,

Write your

mail

all-out

and

development

du Pont,

Milk

keel.

an even

neither

MARKET".

Here's ALL

nii„

leally sold her

tunities to subscribe to

industrial

re¬

economy

our

assume—as

do—that

that

to .assume

here

likelihood there

Arthur V. King Joins

these
character

that it would be folly for anyone

never

4.00'
15.00

the less need and the less material comforts and luxuries to Those security firms that have set
more
people than any other sys-. up booths at exhibits, and country
excuse there will be for govern¬
ment intervention.
And the better tern in history—we're silly, I say, fairs, and stay open a couple of
job we can do of financing in¬ to let this way of life be washed nights a week, are on the right

and

Com¬

our

England

Enterprise

that she

.5.00

tures,

that

imponderables are of a
which can cause fairly violent

If
widely

our

clear to

seems

unpredictables

these

$1 —

PLUS

actions both here and abroad and

PLUS 3 SPECIAL RESEARCH STUD¬

was

talism

economic

plete Weekly Report Service—

downfall

reassuring

After

;

10.00

^-—bi¬

SSosf™-?

firmly system to her people?

But

future, we 'shall have to
to the problem of read¬

falter

disregard the possibility that
tactics of Communist forces
will
test our endurance to
the

special introductory offer. It will

bring

inc

•

Ca»al c°-—.

way &

pu]I^an

She didn't
enough
stockholders; and
believe that we have a' double have
incentive to spur us forward to further, she didn't offer the stock¬
find
solutions.
In
the :not-too- holders she had enough

the

Problems

capital market to for¬

borrowers.

eign

not

Investment

equity Empire. But can't we truly - say'
industry that an important reason for the

reopening the

effectively

American

2.00
>'■

united New jersey Rail-

American

into

money

flow

the

reactivating

>2.09

engaged in a

May Solve Your

coraSng Gia'sV workZI

f mmtatinn? at «?pvpral
justing our economy to a basis
less heavily weighted
with > de¬ consuming; security replaced in,
The better pre¬ centive, and welfare diluted work, hundred dollars per sna
mighty and unquestionably essen¬ fense activities.
We're silly if we sit idly by,
Next, we should advertise more
our
private
capitalistic
tial effort to build up our military pared
and
see
our
fabulous economic widely—in farm journals, union
defenses.
That it is expensive we, system is to carry forward ag¬
as
taxpayers,
know full we'll. gressively with capital expendi¬ system, that has brought more magazines, professional journals.

sources

of mutual

increasing Vl am, of course, aware that vast sections Of the earth's crust, once' singer Manufacturing''
that the problems are involved—both in securely attached to the British Peppereii Mfg Co.—

evidence

masses

but

know,

can

slip thus into eco- Bell Telephone Co.

advantage—both in nomic dependence and decadence?
normal quota of common
sense. should not close our eyes to the terms of trade and in terms of True, the toll of two world wars
We have experienced the greatest
possibilities involved. True, there hemispheric solidarity for defense was* appalling—and surging nabooms in automobile production are a few
hopeful straws in the purposes. ;• V-;;
j: /. r" _*/. tionalism caused upheavals in ;big
student of economics with

year

values-for large

j
i

groups! Clark St. sta.
IRT

subway in hotel.

Telephone MAin 4-5000.
„

HOTEL

st.George
Clark St.

Brooklyn, N. Y.

8ing & Sing, Inc., Management

For every

Volume 174

Number 5064

The Commercial and Financial
Chronicle

(1843)
and

transportation

whom

to
workers,
purchase is a brand

stock

adventure. And bear in mind,
groups are
fast becoming

new

the most

important section of

economy

far

and

They're the

investment, is

for

Ahead

con¬

Commercial banks could, it seems

;

supplying investment informa¬

tion

and

who

literature

make

them

be just

gracious

positor's

small

lot

little

transmitting

de¬

shares of General Motors, Stand¬
ard
of
New
Jersey and
other

worthy issues. Savings oanks,

their

but

would

long-term

make

best

readily

formation

too,

about

interests

available

equity

houses, frankly

invest-

cus¬

small

day be

may

bomb

tail

tual
f

the

funds

the

fine.

newcomer to share

Just,,

what

see

ownership.,.,
happen. Mr.;,'.

can

Spelvin buys 20 shares of Extra-

Then,

he goes

curious.

watches

the

some

than

chemicals

some

others;

are

tobaccos.

that

oils

may

the

the
am

to
<

intelligent

the

road

investment

sane,

just

—

erty'Bonds
of

spawned

bond

vast

buyers right

was

thousand

that

might

-cause

the

annoyed

over,

the

rely

You

-intend

This is

:on

istrator Caldwell."

.•

-as

Tndeed, I

does

nan

/*/

can

General
of

Tiie

current

stock

American

enterprises

which

the

our

V/C- ■'■/■■■ i,;

////;>': .■■■)■■<: /'•

'■^

new

■

nor a

hydrogen bombs when it is not known

For

Eisenhower, is to

man

to say

he is

office—these

public

are

some

offer to hay

are

/'■

■'V-:/ v

•

v■:

' 4

■

premier
Consoli¬

•

'•

:-r

■

v v.'.

V/.--

/ ;

•

■

' /

■

"••

■••'.'

•'

..'v.

any

us.

There won't be

Republican nominee.

of these Shares.

/./■:

"■

'■//

•

•."'

•

;

;/■

•' ■: \;■

'•'.••'■"

••/•

r -;

•

Public Service Electric and Gas Company

dated

Edison,' General
Motors,
Wooiwortn, bocony Vacuum, and
Telephone and
Tele-

American

prudent

suieiy encouraging to
investment for income.

The

that

grapn

are

fact

sagaciously
the

managed
of

endowment

4.70% Cumulative Preferred Stock
(Par value $100

elegant, and so/

fund,

Harvard

per

Share)

Uni¬

versity, is presently composed of
45% in common stocks, should re¬
assure
the
doubting 1 Thomases
about the wisdom of stock
in general.

Price $102.17 a Share

buying

/
So let's go out and get 50,000,-'
;

000 stockholders.

and accrued dividends

Let's spread the

good word aoout equities by liter¬
"

ature.-in the high schools
colleges, in women's clubs

and

Copies of the Prospectus

and

trade organizations..
i; '.It is, of course, incorrect to state
that

England

failed,

may

be obtained front only such of the undersigned

offer, these. Shares iii compliance

with

the

securities

laws

of the

as may

respective

legally
States.

financially

j and industrially, solely because of ./
:

too few

stockholders; but it is not

idle

wider

the

advance

stockholding

dissuaded
Britishers

tens
•;

from

'idea

that

could
have
thousands? of

MORGAN

STANL

DREXEL &

espousal

financial flop it engendered.

iet

re-read the fine

Professor

James

the
*.

phrase

Burnham

BLYTH & CO., INC.

HARRIMAN RIPLEY & CO.

SMITH, BARNEY & CO.

Incorporated

KIDDER, PEABODY & CO.

STONE & WEBSTER SECURITIES CORPORATION

New
* cr.*k
University: "If this
country is basely materialistic in
its

CO.

GLORE,

State-ownership fallacy,, and the
So

CO.

UNION SECURITIES CORPORATION

WHITE,

WELD & CO.

philosophy, then let it be noted

that such materialism is the
of less

most

cause

MERRILL LYNCH, PIERCE,

FENNER & BEANE

November If, 19ol.

WOOD, STRUTHERS & CO.

suffering and
idealisms

cords."

more joy than
which history re¬

Let's get 50 million stock¬

holders—let's broaden the market
at Broad and Wall.

■.

going to

stock of what is being done

issue if Eisenhower should be the

solicitation of

pitayunish

249,942
...

Demo¬

mind, downright stupid.

guise of Russia's physical menace to

of
*

for¬

military

after-

yields

such

present,

organized labor, .socialized medicine, the Bran-

World War I.

5Mj %

hog wild. '

run

offer is made only by the Prospectus.

be developed; this overall package that the next

corruption in

Plan,

such

offer to sell

intend

The

wonder just how long they

you

and the* politicians

and

past

But

great enough to

issue, the all embracing issue of

stop, look and listen and take

//, ■'/'

This announcement is neither

they

demands

in the

Civilian Defense Admin¬

'■

the

this;

compared with the greater question of whether

added

this overall

are

crat in International affairs but a;Republican in domestic affairs

for

earlier/publicity concerning the atomic

stockpile is not enough for

Presidential election should turn.

come

instance,

bomb explosion.

just how long the American people

vast development, of

•whether

-The

scientists

one

spending, the secret spending for bombs, the spending of billions

were

/well/ though hard

our

and

Russia.

war upon

let the military
on

eign policy

even

hand

wonder

It is

appar¬

man,

in making

upon

'Swallow such propaganda as

had

man

because

there

greater stockpile of these bombs.

•make shambles of us, our greater

Five

several

over

ah atomic

was

unquestionably have

of them

minus,

ear

least

explosions

.although the few bombs Russia might have

were sup¬

Vegas Chambers of Commerce

Instead, the exploding bombs have

two

Now, here is the most amazing part of this amazing situation.

bomb experiments in their state for fear it would hurt the tourist

attraction.

bombs, must have at

recorded

Bargeron

which

area

different ;pr Controlled bomb

Nobody ha£ been so foolhardy as to say Russia
over here to do this, but the Russians have

troops

Stalin "admitted" it
Carlisle

they;counted three turned around but did not
a

we gone so crazy as this?
Well, it seems
of the most inefficient and uncivilized nations on earth is

land

atomic

have

experiment,4herp.. were-also thousands of tourists.

sale and later redemption of Lib¬

group

could

traffic-with the newspapermen.

told that the Reno auchLas

trade.
•

a position, among otner
things, to soundly start hundreds
on

one

out to conquer us.

The Atomic Energy Commission, that citadel of

element

today is in

of thousands

that

Anyway, along ;with .the- thousands ofrsoldiers

quite

himseit, *Why don't 1 buy. five
shares of Amerada, ten shares of
Allied Chemical, or ten of Woolwortn?" and, lo, before you know
it, this lad has blossomed into a
full fledged investor, an expand¬
ing shareholder, and an excellent
client, to boot!
J In other words, the mutual fund

his associates

Now, just why have

remotely exposed, to fall off-tin six,months.

and

say

But this

a' / ;

dynamic than

Then

going

are

doubt.

"mopping up" expedition into the

ently,

issues quoted in. the daily papers.
He notices that

Subsequently they got up/and

from putting

But you wonder just why he and

military and with funds already on hand it has some $92 billion
in the current fiscal year. The answer is they are com¬
ing up for more. It is amazing, but it is true.

applied by Russia,

seven miles of the
explosion
down, and turn their-heads in the opposite direction.

beast.

this, he gets

over

us as

not to permit us to cur¬

After the explosion

went

those made by

would have any apprehensions on this score
right at this time.
The last session of Congress appropriated soma $57 billion for the

thousand troops were massed within

up..

Such statements

to spend
on

mystery and secrecy, had

get

bewildering.

ground troops

and the air force.

soending on -'other*forms of warfare.
this, light, it is little difficult .to tell jtist what the recent

and told to sit

we must never drop the bomb until we
devastating effects because the Russians might cease

of its

It is all pretty

been told up until a few months
ago' would not be fit for

mutual SnaresHe gets m the mail
a list of its -securities in
portfolio.

sure

General Bradley are intended, of
course, to keep us
too much stock in the bomb at the expense of the

was

our

mu¬

introduction of

who

Russia applied by us, it seems there
in the propagandists' minds.
Cer¬

posed to prove,
■

requisite, I would certainly urgeV
of

man

experiments in Nevada in the tactical, use of the bomb

pre¬

some

the service and results shown. And
if a larger commission is a

warning that it could

doubts

some

use

by the propagandists, there is

tainly such doubts

big buyer, or send a big
buyer to you, if he's satisfied with

the

told

are

cultivate

buyer. To those I say,
that the small buyer may well be
because

told tales of

until just before the attack; at all
Along with this is another current

to be afraid of it.

political lame duck, going around the country
daily telling us this. As to the effect of the

cultivated

are

war.

Administrator, Mr. Caldwell,

mission on, say, 10 shares of Gen¬
eral Motors
is not sufficient to

justify effort to find and

catch the

can

Pentagon explanation that

The bomb would be devastating.' You have bur
Civil Defense

brokerage
that the com¬

say

in itself to -win

upon

the

and down the scale in this way

As to the effect

*ment.

A number of partners and
tomers
orokers,
in

country.

in¬

depended

were

other times they are scattered.

only rermotely exposed to an explosion having his ear
drop off six months later, and again of how
the bomb was ineffective
against an enemy
who might be just around the corner in a
hilly

harm

not

destroy whole civilizations

running

will clear stock
purchases for de¬

positors,

could

not

few

the

purpose would be served by

dropping
Pentagon explanation being peddled as to
why the bomb is not used in Korea is that the Chinese Commies

spending by our government of billions of
development and construction of the atomic bomb,
the propagandists have
swung pendulum-like from the theme that
dollars

for

order

being told that unless

we are now

do not concentrate their forces

Along with

depositors

inquiry, and

could

Indeed,

way.

enemy in mass formation
the bomb.
The latest

By CARLISLE BARGERON

me, do a lot more than they do

English Channel marching 100 yards apart,
atomic bomb could stop them. And
they would be just devilish
enough, I understood the General to believe to march just this

of the News

fat cats.

new

out tomorrow for the

Washington

our

capacity

saving
cerned.

Speaking recently to a meeting of the American Petroleum
Institute, General Omar Bradley, said that if the Russians started

From

these

The Commercial and Financial Chronicle...

(1844)

point

Strong
Economy and Alert Citizenship
Warning

making

wealth

one

every¬

in
no

holds

are

amples

failed

between

tions

Roman

its

Shield

Lansing

greatest

test.
the

system is only as good as

citizenship of those who live
it.
Its
only true value

under

lies in
free

providing
We

men.

of life for

a way

inclined to

too

are

consider it superior because of
achievements in the field of

its

mass

production and mass distribution.
We place too much reliance on its
lethal

its A-bombs,
guns
and
jet
;planes.
These
weapons might well be carried on
both sides of America's ledger—
they
a

products

liability

much

asset.

as an

the

most

sword's

modern counterparts, we would do
well to be mindful of this Biblical

prophecy.

These

weapons

themselves will hold back only for
a little
while the rising wave of

Communism that has already en¬

gulfed

earth's population. Our

might

influencing
friends

The

peoples
the

Africa

will

expected.

Asia

reacting in
disconcerting
to
us.
be

not

and

manner

The

free

preserved

in¬

definitely by using armed strength
force

the

down

throats

peoples.
It

the

American

the

upon

of American
success

world

preservation

democracy. In turn,
failure

depends

citizenship.

free

The

quality of
dynamic quality

of the American system lies in the

willingness of generations of citi¬
zens

alter

it to

conditions. As

way

life

since the

has

and

meet

result

that

changing

all

enjoy

systems

beginning of time itself

provided

the

greatest

im¬

provement in man's lot.

ddn't

try

that

tain

over

that

alarm
trie

tion of

our

weaknesses

impair

system.

freeze

don't drop an

the

Citizens

necessary

gains
iron

and

strength
who

we
—

cur¬

abuses

view

our

with

changes remind

Chauncey Depew's defini¬
a

person of narrow vision.

♦An address

by Mr. Shield before the

4)cctspatfon&J Vision Conference, Atlantic
City, N. J., Nov. 2, 1951.

of the
from

Industrial

before

years

analysis of

Stock Index, 12 trace
Civil War and another

the

their beginnings in 1900 or

been paying

companies have
to

seven

seventy-nine years.

started paying

dividends 119

earlier.
Twenty-three
dividends continuously

Of the other twelve, one

years ago,

and its stockholders

have received annual dividends regularly with the exception
of the years

1833, 1840 and 1858—National Quotation Bureau,

Inc., 46 Front Street, New York 4, New York.
Pennsylvania Tax Free Long Dividend Paying Stocks—List of

„

industry to strengthen

140

stocks—Moore, Leonard & Lynch, Union Trust

common

Building, Pittsburgh 19, Pa.

familiar ring, doesn't it?

improvement this
must
be
accepted

dole.
the

In the last two centuries of the

Empire (284-476 A.D.)

this trend

pronounced. Rome

was

even

was

engulfed by Oriental attitudes

which contributed still further to
disdain toward the obligations of

citizenship. The apathy of the
people heralded the approach of
the

dark ages.

Now

story

seems

the

old

Roman concept is

head.

have

gone

more"
—

;

quality of citizen¬
evidenced by a "less for

philosophy in this country

less

effort

seems

there

reward.

that in this machine age

for

tendency to let
"George", the machine, do it. The
Roman

the

slave, the

machine

our

more we are

in¬

responsibilities

our

citizens. I must confess, in my
home

own

TV,

this

latest

machine,

considerable

causes

shirking

of responsibilities.
This

change in

titude

our

is revealed in

Insurance

national at¬
many

ways.

companies sell millions

dollars'

worth

annuities

through the

use of pictures show¬
ing a man and his wife at 65 no
longer having any responsibilities

but

traveling luxuriously all

the world

plicit

over

this

$250 per month. Im¬
sales approach is

philosophy that one becomes
happy only when one is

from

his

obligations to
»

enjoyed by his
rural society.

are

sense

forefathers

so¬

for

say

that many

of our citizens holding
public office shirk their responsi¬

they
example,

For

plans

now

illusory form of security. If a
is

until he is 65 in order to

pension, he is trading some
of his liberty for security. Plans
that guarantee a pension even if
a
worker
changes jobs
(these

get

here

plans

are

known
be

needn't

'
*

for

desirability of having the worker
participate directly in the fruits
his labor, but actually profit-

sharing plans have few adherents
in industry. Commonly the excuse

Co., 1 Wall Street, New

Co.

—

Analysis

Ltd.—Circular—Bond,
5, N. Y.

Lomb

Cerf

Oprp.—Circular—L. Johnson & Co., State
Also available are data

Company—Analysis—Barclay Investment Co., 39 South
Street, Chicago 3, 111.

La Salle

Equipment Limited—Analysis—A. F. Francis

Farm

Cockshutt

Co., Ltd., 68 King Street, West, Toronto \, Ont., Canada.

Collins

Radio

44 Wall

Company—Analysis—Butler, Candee '& Moser,

Street, New York 5, N. Y.

Connecticut Light &
W. Scranton &
Also available
nectivut

Power—Descriptive memorandum—Chas.

Co., 209 Church Street, New Haven 7, Conn.
memoranda

are

Power,

New

Haven

United Illuminating, Con-

Gas

Light,

Electric

Hartford

Light, and Harftford Gas.
A.

Darling Company—Late data—Moreland Co., Penobscot

Building, Detroit 26, Mich.
Douglas

Oil

Co.

National Bank
Erie

California—Analysis—Ferris

Co., First

Building, Dallas 1, Texas.

Forge—Comment

in "Highlights"—Troster, Singer &

Co., 74 Trinity Place, New York 4, N. Y.

Also in the

Continued

same

page

businessmen

are

make profits,

Our Current

Erie Forge

they should be smart

smart

enough to

enough to divide them equitably*

fringe benefits—such

workers out of

total of

page

will

comment

Safety Car Heating & Lighting

Brokers

Troster, Singer & Co.
Members;•

Security

Dealers

Association

Trinity Place, New York 6, N. Y.

Telephone:

HA 2-2400.

Teletype NY 1-376; 377; 378

Private wires

Cleveland-Denver-Detroit-Los

Continued

■

Beryllium Corp.

For Banks

DeauZ&

"Highlights"

Jacob Ruppert

The impression has been created
that

Co.,

Building, Syracuse 2, N. Y.

equitably is
the difficulty of working out a
plan that is practicable. ,Yet if
system

Richman

South La Salle Street, Chicago 3, 111.

distributing the rewards of the

profit

Freehling,

Company—Analysis—Floyd D.

Optical

Inc.\l20

given for failure to use this means
of

—

Gisholt Machine Co. and Dayton Malleable Iron Co.

Buda

We have heard much about the

Metal,

Company,

Tower

super¬

annuated workers.

Foundry

Bingham-IIerbrand

vested plans)

security

providing

million

City,

Jr.

the accepted method

perform. Speaking

Atlantic

Bausch

should

Kabuto-cho,

1-1,

Wall Street, New York

required to stay with one

company

.r:f

/■

Machine

American

are

as being nec¬
security of the

the

Co.,

Meyerhoff & Co., 120 S. La Salle Street, Chicago 3, 111.

already adopted by industry give
man

5, N. Y.

American

sick
adequate
vacations,
and
bilities. They are not even part- pay,
insurance — have
been
time citizens. Their chief ambi¬ group
adopted
generally
in
industry.
tion seems to be
spending—they
But is this so? Well, based on the
apparently have become allergic
latest
available
figures
(1949)
to work—they seem to be so busy
group
insurance protection, the
doing
one
another ' and
their
most widespread benefit of them
friends
favors
they. have little
all, is enjoyed by; less than 17
time to discharge the duties
they
sworn

York

worker, most of the pension plans
an

Securities

Yields—Bulletin—Francis I. du Pont &

generally recognized
essary

Nomura

—

Nihonbashi, Chuo-ku, Tokyo, Japan.

social

our

solid

appear.

retirement

while

Yet

of current market action on

Securities Exchange with spot quotations on Major

listed

Stocks

toward

worker.

not

the Tokyo

se¬

Barbara, Calif,

Tokyo Market Review—Review

understatement

have

Santa
.

.♦

progress

are

make

the

have

not

does

there

curity and feeling of achievement

sometimes

Too often the

state

basic
problems that have not been ade¬
quately resolved. The worker still

gains

Citizens

responsibility
by full-time

industrial

our

developed,

industrial

Shirking Our Responsibilities

ship

has

Service—Special introductory offer for five weeks of
complete weekly report service (via airmail) plus three
special research studies and booklet "Planning for Profits in
the Stock Market"—$1—Dept. C-95, Investors Research Co.,

these f
goals has been made since the
19th century exploitation of the

the hill and down again.

citizens.

Much

rearing its ugly

seem

Because

personally prosperous?
our system needs so much

Stocks—Analysis—Ira Haupt & Co., Ill Broad¬

New York 6, N. Y.

way,

Our Social Gains Are Not Solid

history repeating itself.
Today in this country this same

the

that

ever

ancestry

nine had

obligation

Also available is

Company.

Report

were

government

ciety.

than

Grocery

Over-the-Counter

their

made them

idle mob

truly

imperative

reau's

John

Citizens

Is it not the primary
of leaders in

bounty

Weakness and Abuses That Impair
''freed
Economic System

At this critical time, it is more

Full-Time

Need

up-to-date comparison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks"

of corrupt politicians in
exchange for votes. This has a

Countless others subsisted

democ¬

the

monthly

Quotation Bureau Averages, both as to
yield and market performance over a 12% -year period. Of
the 35 companies represented in the National Quotation Bu¬

society is more significant.

Lovett

Public Utility

living

clined to shirk

generally recognized that

dependent

racy

skeptical

.;'■■■

survival

the

system

those

showing

Taxes—Bulletin—A. M. Kidder & Co., 1 Wall

tjie economic system which al¬
ready has contributed so muchrio
the American way of life and has

000 members of

making

and

way

than

charts

used in the National

who .is

broader

taxation—Dean Witter

Over-the-Counter Index—Booklet showing an

and this applies to
here tonight—

—

issue—1001

November

Street, New York 5, N. Y.
Winn

Doe, and the impact of their ac¬

by the time of Julius Caesar, 320,-

increasing
isn't

are

world

professions

tions

Gains and Losses—Changes in

Exchanges from 1940 to November 1, 1951—single
(spiral bound), $10.00; yearly (6 revised books), $50.00.
W. Stephens Co., 15 William Street, New York 5, N. Y.

—F.

the

and

Oils—Analysis—Dreyfus & Co., 50 Broadway, New

How to Save

industry

comment—Cohu

Co., 14 Wall Street, New York 5, N. Y.

copy

—

and Curb

responsi¬

area

Responsibilities

The social

occupations.

apparently

restless millions

"home.

everyone

than one-third of the

military

baths

wide

Coppers—Leaflet

and

highs, lows, earnings, dividends, capitalization, and volume
virtually every active stock listed on New York Stock

his

citizen's

Broadway,

120

job, in his community, and in

are

Oils

Charts—New

lights. He
family,

his
for

cover

leaders

period of

In the

was

good citi-,

Co.,

4, N. Y.

Capital

little

has

analysis—Abraham

5, N. Y.

contribution to organized

full-time

his

structure disintegrated so fast that

"They that take the sword shall
perish
with
the
sword."
As
creators

useful

—

turn out to be

may

his

periods of

banquets. Only the slaves worked

•

Our

living

interest

chief

according

bilities

C., during the last
century of the Republic, larger
and larger numbers of citizens be¬
came
so
complacent that their

itself

system

will be put to

the

time citizen?

changing world.

during

history.
27

Two of the most striking illustra¬

peoples of
opposing
ideologies the

133

Canadian

the

general election. But is he a full-

the realities of

Am erican

but

Lines,

York

thus

York

Co., 1 Wall Street, New York 5, N. Y.

charities and usually votes in the

attrition

occurred

make

nations

their societies to
a

eventually
their citizens

when

adapt

Air

con¬

of things. At best he is

course

makes

ex¬

many

where strong

fallen

have

are

trying

history

earns

have become weak and

arently

who

ranks

confused. John Doe is

democracy?

provides

History

barred. In this

war

American

our

the

confidence in his ability to change

zen

which

app

disturbed

the test of

citizenship the

life and death

New

D-O-E, and not John D-O-U-G-H)

the

struggle

endless

look

degree^to which we are willing to
overhaul and continue to improve

our

Airlines—Detailed

fortunate in having a ma¬

While

will

quality of

fight an uphill
in this State,

say

making, the average man John
Doe (in these days of high taxes
John Doe should be spelled John

the

might

scientiously

be tested

the following literature:

American system work.

at the same time. Isn't

citizenship

are

and

through 'a keyhole with both eyes

The

firms mentioned will be pleased

send interested parties

jority of office-holders at the top

crisis.

could

It is understood that the

sys¬

conscientious

servants

battle.

narrow-minded

who

one

Recommendations and Literature

our

American

our

minority

public

My theme deals with the qual¬
ity of citizenship needed as the
free
world
faces
its
greatest

man

parasites of

tem.

strengthen unity of economic system.
a

plague

today

under an en¬
lightened citzenship. Says too much emphasis is placed on
value of mass production and distribution while superior
weapons in themselves will not permanently hold back Com¬
munism. Urges all to assume responsibilities of ''full-time"
citizens, and advocates granting stock ownership options to
described

these

society highlight the abuses that

of maintaining a strong economy

Dealer-Broker Investment

corrupt-

members of
racketeering

fraternities. The rise in power and

isn't influencing peoples
friends, President of large chain organization

stresses need

Democrats,

with

league

politicians are the
gambling
and

increasing military might

our

all

the

Union Company

President, The Grand

part-time

these

not

are

either.

SHIELD*

By LANSING P.

that

out

citizens

Our Strength Lies in

Thursday, November 15, 1951

Angcles-Philadelphia-Plttsburgh-gt.Lottla

Volume 174

Number 5064

Commercial and Financial Chronicle
The

(1845)
pect

Facts and Forecasts oi

(3)
pect

Vice-President, Dun & Bradstreet, Inc.

the

economic

(2) highest employment in history at top wages;
(3) all-time high for manufacturers' sales; (4) inventories
still large despite reduction from May's peak; (5) a new high
point for demand deposits and commercial bank lo^ns; and
(6) corporation profits still in ascendency. Sees heavy inven¬

just

events

the

Joint

for

the

nomic

ago

When

of Congress

these

im¬

were

the

Roy

was

A. Foulke

Only four

ago,

years

economists,

columnists,

prac¬

indi¬

the

and

write

news¬

those

weekly

four-page letters solving all of the
problems in this world, no matter
what they are — practically nine
of

out

ten

serious

these

said

ago,

years

people

depression, with heavy

Taft,

who

the

was

port at that time, felt that

legislation would be

some

necessary

the end of the year if business was

going to be as bad as was so wide¬
ly and uniformly predicted.
But
he said, "What legislation should
have? While

have the opin¬

ions of people all over the

that business

bad,

have

coun¬

going to
real facts

which to base any
>

gress

us
we

the

for

asked

Economic

Report

who at that time

to New

with

was

assistant,
York, and sat down

work

out

basis for

manu¬

facturers,

wholesalers, and re¬
tailers, in all parts of the country.
That
was
in
May.,
1947.
We
worked out a plan to obtain infor¬
mation

six

profits,

items, and those six

these:

were

sales,
employ¬

orders,

selling

prices,
ment, and inventory.
We

out

went

manufacturers,

right.

called

and

wholesalers,*

and

this:

"Do

ques¬

believe

you

sales for the full year 1947
(this was in May, 1947) will be
smaller or greater than 1946, or
your

about the same? If you

you

give

smaller

think they
will

greater,

estimated percent

asked the

same

ques¬

tions

regarding his industry. We
asked, "Do you believe the sales
address

Annual

Conference

Finance

Industry,

29, 1951.

level,

and

discuss

term

trend

inflation.

take

each

those

the

(4)

Let

every

but

doesn't

look

indicate
ness?

commerce

higher

Here

mey

level of

which

busi¬

manufac¬

all-time

result

resistance to

This advertisement is not, and is under
.1

consumer

high prices.

and

ers

wholesalers

reached

all-time high in May.

Continued

are:

Mr.
of

New
■

Foulke
the

York

7th

Commercial

City,

Oct.

circumstances to be construed

as, an

page

offer of these

The offering is made only by the Prospectus.

NEW ISSUE

found

over, we

$40,000,000

our

record

was

new

General and Refunding Mortgage Bonds
Series K, 3%%, due 1976

their \ respective

in May,

1947 has been

Dated November

Due November

15, 1951

the

15, 1976
'

country

was

off

OFFERING PRICE

April, 1948, we made another
of this character, this time

101.783% AND ACCRUED INTEREST

survey

for

our

use.

own

tions, and again

same

timistic regarding

ques¬

got the same

Businessmen

results.

busi¬

asked

the

executives

were

their

own

op¬

Copies of the Prospectus
named

the

may

be obtained in

Prospectus and

others

their

individual

own

out

businesses

1948.

have

made

similar

since that time, but

Kuhn, Loeb & Co.
Union Securities

BIyth & Co., he.

Corporation

in the

accurate

light of what eventually happened
We

State only from such of the several Purchasers
lawfully offer these securities in such State.

turned

any

may

busi¬

little less optimistic re¬
garding their industry, and by and
large they were pessimistic about
the economy of the country. And,
again, what they told us about
nesses,

Carl M. Loeb, Rhoades & Co.

Wood, Struthers & Co.

Fulton, Reid & Co.

sur¬

have

November 15,1951.

discontinued

asking businessmen
any questions regarding their in¬
dustry and regarding business in
general, because we found out
that the aggregate of what they

tell

about their

business is

own

This advertisement is not, and is under
i

We made

accurate.

our

last

;

securities

sur¬
„•

of this character in the first

vey

days of this month, when

for sale

or a

circumstances to be construed

solicitation of

offer to buy

The offering is made only by the

NEW ISSUE

any

as, an

offer of these

of such securities.

Prospectus.
•

-\-'V

asked

manufacturers, wholesalers,
in all parts of the
country to give us their expecta¬
and

retailers

tions

business

quarter

for

with

the first quarter of
Let

give

1951.

you

of 1951

was

quarter.

exceptionally
had been at

for

Korea

Florida Power & Light Company

few of the

high lights of that survey. But
keep in mind that the first quar¬
ter

$10,000,000

first

compared

1952,

the

six

First Mortgage Bonds, 3%% Series due 1981
Dated November

1,1951

Due November 1,1981

months.

Business

was
at a high level of
activity.
Profits were high.
In
January of this year we had had

the

second

wave

buying.

sumer

ground,
out" in

this
the
in

With

first

our

survey

Six

1952

101.377%

AND ACCRUED INTEREST

back¬

found

days

this

expecta¬

regarding the

Copies of life Prospectus may be obtained from the undersigned by persons
in any State where the undersigned may lawfully offer these securities.

first

year:

out of every 10 busi¬
interviewed expect

Kuhn, Loeb & Co.

higher sales in the first quarter
of

OFFERING PRICE

con¬

that

what
12

scare

"business

quarter of next

(1)

than in the

first quarter

of 1951. Two out of
every 10 ex¬

November 15,1951.

Since that

securities for sale or a solicitation of an offer to buy any of such securities.

high.

wholesalers,

(5) Dollar inventories of retail¬

standing characteristics of indus¬
try, banking and

however, haVe been easing since

those eight out¬

are

sales

Sales of retailers and

March,

First, what

10 busi¬

are

points

Dollar

turers

long-

the track.

nessmen

*An

retail

briefly.

(4) Four out of

process,

and

about

economy

tion"
we

was

But .their opinions about
industries and the

month

of the change?"

Then,

employed, but they are
employed at the highest hourly
and weekly wages in our
history.

their respective

try. We would ask them

people

the

sale

than the other three break¬

Eco¬

sales

businesses

war

will

1947

vidually

good

(3) More people today are em¬
ployed than ever before in our
history. And not only are more

of this high
I would like to dis¬

would

high. In other words, the aggre¬
gate of the information which
businessmen had given us indi¬

retailers in all parts of the coun¬
tion

Congress for the

billion, which

obtaining information from

items

ing.

history, and the profits of all
corporations amounted to $18 V2

veys

legislation."

their economist, and his
came

and since then have been stiffen¬

sketch

able goods expect relatively higher
employment,
which
is natural,
during the first quarter of next

in¬

that

had been the highest in

if there was any way in
could get facts for them.

Dr. Hardy,

turned

So the Joint Committee of Con¬

which

ployment, manufacturers of dur¬

to the Joint Com¬

year

ness

for Congress for the Economic Re¬

try

re¬

business

(3)

present

in March of this year. Wholesale
prices went off steadily but very
slowly from March until August,

fly in the ointment, which
is heavy inventories at the whole¬
cuss

manufacturers,
wholesalers, and retailers for that

un¬

Chairman of that Joint Committee

optimistic

the

four

in for

were

employment.
Senator

less

over

When

of ten business¬

out

bankers,
who

tabulated the

that

heavy unemployment. That was
only four years ago, and Washing¬
ton at that time was wondering
what legislation should be passed
to
take
care
of
unemployment
when it passed the five million

viduals

activity.

em¬

operating today. (2)
give you a brief

background

retailers.

question of

one

level

we are

I would

non-durable
or

activity which indicate

high

which

back to

came

nomic Report.

postwar depression and potential

paper

the

was

goods,

downs.

whole.

mittee

the

tically nine

wholesalers

coming

men,

little

formation

greatest

mark.

sample

durable

the

are

their industry. And the
great majority were pessimistic
about the economy of the country

business

country

the

were

the

garding

anything to do

the

nessmen
expect higher invento¬
practically all the businessmen ries; three the same inventories;
and three lower inventories. Those
were
optimistic regarding their
indicate
a
leveling-off
own
individual businesses. They figures

Com¬

worry

year,

whole.

whether

economic

(2) Wholesale prices reached
their highest point since 1779 —
that is, 172 years ago—last March.
prices

(1) I would like to enumerate
eight signficant characteristics of

whole¬

were one year ago.

time, wholesale
4% higher than a year
ago, but 4% lower than they were

of Economic

Now, I would like to do four
things in the next few minutes.

results. The strange thing was that

mittee in Con¬

—the

That information

gress that has
with

New York where

that

most

for

same

with 1946?" Finally
asked the same question re¬

States

year—

Committee

will be smaller

about the

are

manufacturers

goods,

manufacturers

1947 compared

might

portant

greater

goods,

manufacturers

goods,

for your industry

survey

(1) Retail prices today are the
highest in the history of our coun¬
try. They are 9% higher than they

Characteristics

manufacturers

points, the returns

similar

lated to the business in the United

less

that

the

years

haze.

Report

say

that

Eco¬

existence

and I

Committee

been

than

pace

few

to get lost

seem

had

such

ex¬

Activity

into

non-durable

But

live

(5) Four out of every 10 busi¬
expect
higher prices;
five
the same
prices; and one
lower prices.

salers, and retailers. On most of

inflation trend.
We

every

this

down

durable

fly in ointment of present situation and forecasts long

process

nessmen

employment, seven
employment; and one

details

broken

history;

tories

out

leveling-off

greater
same

The

(1) highest retail and wholesale prices in

activity:

Two

the

has been sufficiently great at the
wholesale and retail levels.

lower employment.

significant characteristics of current

though

two

profits; and three lower profits.

By ROY A. FOULKE*

Mr. Foulke enumerates

volume, and

same

(2) Four out of every 10 expect
higher profits, three the same

Economic
.

the

expect lower sales.

The Commercial and Financial Chronicle

...

Thursday, November 15, 1951

(1846)

terms are much more

Reversal

MOLODOVSKY*
Members, New York Stock Exchange

)

the formality of a mere

Yorker" would put

As "The New

third of a could not

It. this discussion is the

of trend.

scries of three. The first two were

"The

published

Commercial

Financial

and

Chronicle"

and
Aug. 16. They
presented a n
Aug.

outline

tion, the stimulations
and

correction
*

examine

the stock

the upward

look.

the

conclusion
stock
were

probably
forming an

Nicholas

Important top.
This
opinion
conditions

that

Molodovsky

underlying

unfavorable

were

'■■■.-v'.

week.

for

The Index of

the continuation of the bull marfcpt

mnrip

DmW

„

°nd?.r.y St?'v
qua^ty stocks.

Areas
Areas of
01

«ndndeataSa through1leneftv

„„

•

earlier than at the

zone

better protected core. And should
the new downward trend gain mo-

who chooses to operate

against
when
It is traversing its final phase,
must be prepared to pay a heavy

riods

appropriate

name seemed

traced

structed for that purpose.

suffices

make

aware

one

J 1

As noted in

ward drive from the June lows our

index

was

advancing at

much

slower rate than the stock prices

AU?; 2' ^LtTon" £e ancf our index was even greater
the .ta at the two preceding since
tops
pebusiness
improvement, L
? f Lg
rppnrrapr,

thp

Chart II

presents the latest de¬

velopments

market

the

than

detail

greater

Chart

in
It

shorter period, beginning

covers a

only with the second half of last
June.
It plots daily data instead

light-hearted operators were
pursuing speculative blue¬
birds in holding up the bids for
secondary stocks.

still

of weekly figures.
Its purpose,
however, is not so much to am¬
In all fairness, I cannot claim plify the picture as to illustrate
the changes that have taken place
that "I planned it that way." After
the Dow average had crossed 260 during this period in the internal
last May, I felt that the distortion structure of the market in terms
of the relative activity of tran¬
between
t h e
relative action
of

mentum, it is bound to extend beyond the margin. In economics, as leading and secondary stocks
in politics, a house divided can- proceeded too far to make a

Z themselves. And at their Septemthe ber top, the distortion between the
the
if
1pvpk
f
to k
nrioes

of indecision. gAnH fnv " ™heconomic truth that, on
nrtlicton And any- simple an mdex ts based m
of

periods
one

Effective Demand

3 ,prlce 1

1(1

1S 5

nvart

rlvTll
reversal.

ite
its

liming

atfpmnt

up-to-date a dustrials, had taken thix year
similar graph contained in the ar- three big steps upward
It registicle of Aug. 2. Once again it plots tered successive new highs m .Febthe Dow-Jones Industrial Aver- ruary, May and September
It also
ages, as well as the Index of Ef- becomes apparent at once that on
fective Demand, at weekly inter- the contrary, the Index of Effective Demand was completely un¬
vals, showing their respective Fri¬ able to exceed later in the
year
day closings. It extends from the its
February-March level.
Even
beginning of the current year up
during the market's powerful up¬
to and including the close of last

out¬

prices

re-

brings

Chart

They

that:

trend

economic

the fact that the stock market, as
measured by the Dow-Jones in-

Effective Demand

the

reached

marginal

Index of

Stock Prices and

mar-

a sur-

of
vey
business

clearest manifestation.

versal

reversal of not stand.
trend of stock prices.
Even a cursory glance at Chart

condition of
Let and

or pressures

acquire their greatest significance

witnessing a significant

the

equity's

May top.

own

mentally

outline

the

background

qualify as a real change iikejy to manifest itself in the
then

should

showed

whether
recent developments in business
conditions and in the stock market
itself have
increased or diminished the probability that we are
Let

One

of
1951,
it stock prices, but was caused mere¬
that, in the opinion of in¬ ly by the relatively greater re¬
vestors, the outlook for marginal sistance to the decline on the part
enterprises was unfavorable. It is of the secondary equities. Many
investors were
al¬
at the economic margin that the conservative
realities of expansion or contrac¬ ready shading offers, while the
nomic

in these columns, analyst
market s summer rise, of
the recent top of stock prices and of the ensuing reversal.
Concludes that last month's break was not a mere technical
correction, and that it is likely to be followed, with interrup¬
tions, by further downward adjustments in the stock market.
Bringing up-to-date his latest articles
discusses some characteristics of the

condition

from

NICHOLAS

White, Weld & Co.,

well below its

even

eliminate to signal that, in Keynes' worus,
by the the "game of musical chairs" was
than values measured in dollars
and cents.
A declining trend of index a section covering the two on.
On
the Index
of Effective Demand week period ending Sept. 28.
But let us not indulge in sym¬
reveals that secondary stocks are Chart I, this section is boxed in bolism. instead we shall translate
by a broken line rectangle. The what has been
receiving an increasingly lower
recently happening
valuation
in
terms
of
quality strength of the index during that in the marKet into statistical ngstocks. Viewed against the eco¬ period was not due to a rise of ures.
Cnart
II
has
been
con¬

Outlook for Stock Prices and
Reasons for Recent

indicative of

internal

market's

the

speculative
It is

phase

true, of

tops

capped

such

was

that

market

bull

will

believe
not

done in the

end

Chart I.

the

mately 14%

happened

course

ripen
the

daily

change

declined

about 6%

Stock Ex¬
from approxi¬

the market's

the

in the

rise to its

During the same

maturity and, in

September high.

natural sequence,

disintegra¬

period, the relative volume of vi¬
sion
stocks rose from
approxi¬

particularly in¬

mately 8% to approximately 19%.

tion, it becomes

specimen

the

for

ana¬

lyst's scalpel.

balance,

each of these two groups

normally

When

the

market

represents 10%
volume

Analysis of the

average*

full

entered upon a normal

structive

II,

into

course

number

total

lent to thinking that men can die
only of old age. But since it so

did

percentage of the daily vol¬
ume of transactions in value stocks
traded

rise

...

the

last

„•

As may be seen from Chart

phases of development is equiva¬

the

II, as

appearing on

until it goes through all the typical

that

used

are

of the Index

case

of Effective Demand

development cannot be, however,
necessarily taken for granted in
advance of the event.

stocks

for the construction of Chart

and

foam
of

occurrence

quality

equities ("vision" stocks)

that the final
rises have been

speculative

The

two statistical

same

("value" stocks) and 50 secondary

probable.

very

The

samples

course,

many

froth.

sactions.

had
new

Relative

Activity

traded

of the total daily
on

the Stock

Ex¬

change.

of Transactions
To

complete

this

picture,

The deterioration in the quality
relaSl
b y
*
:
■
should be mentioned that the rela¬
tively more than: the stronger
In fact, in examining Chart I of trading' has been particularly tive volume of value stocks has
companies. Conversely, in periods with greater attention, we observe
not only been gradually shrinking
pronounced since Labor Day. "Cats
cost in nervous wear and tear, re- of deterioration of business, the that in order to place the Index
during the entire period of the
and dogs" started dancing a lively
gardless of the final financial out-' weaker companies begin to suffer of Effective Demand in a truer
rise, but it has since been giving
saraband to the tunes piped by indications of
come.
'--./.v.if' v*-Vo?sooner and continue to suffer perspective we should foreshorten
increasing during
it by a goodly piece. In terms of
This is a situation quite typical more than
the well established

established

of important

trend,

even

weaker

companies improve

turning areas of stock companies.

•

conditions

These

Let us mention, as an il- relative improvement or deterio¬
lustration, an article which ap¬ ration are reflected in changes in
the demand for the stocks of these
peared in the "Chronicle" of Nov.
22, 1945. This study was written secondary companies. And this, in
prices.

respected Wall Street econo¬

mist, the head of the research de¬
partment of a well known invest¬

our

high

relative

reached

visible
market

was

measured

Dow-Jones'

market

declines the

index.

Values

its

Sept.
on

was

Index

industrials,

its

1951

the

closing

13. As is clearly
chart, when the
its September peak,

the
at

of Effective

such

cal

stocks

peared
tive

Industries

Electric and Musi¬

common

which

repeatedly as the most

stock

the

And

day.

ap¬

days

lower

stock

and
Since

prices,

drying up again on rallies.
the middle of September

there

ac¬

this

Continued

page

CHART II

Demand

not only considerably under
February - March level, but
DCffl-JONES

the

The author' took

trust.

ment

turn, brings about rises or

the

CHART

INDUSTRIAL AVERAGES

the then current
market appraisals were

position
stock

that

largely

o v e r that it

stressed

optimistic.

excellent

was

time to emphasize the adverse side.

Even

though

riot reach the top

iassisjsss;

stock prices did
of the bull mar¬

ket for another six months, while

drastic

truly

materialize

decline

for

did

than

not
nine

months, these events justified the
author's warning.
*
That

article

same

% VISION VOLUME
OF TOTAL VOLUME

telling experience. It
was the
story of the head of a
large investment house who, in
the spring of 1929, foresaw the
coming crash, but was dissuaded
by his partners from adopting
proper preventive measures.
To
quote from the article in question,
even

"He hadn't

DOW-JONES
INDUSTRIAL AVERAGES

enough to go

assurance

against the tide. It is much easier
to join the crowd than oppose it,
particularly when it is on the op¬
timistic side."
Outside

„

of the

extended

period

zl
IgMHB ■■gglBI
!■■■»■'■ ■■■■■■I

needed for its formation, we wish
to

draw

recent

parallel

between

% VALUE VOLUME

the

OF TOTAL VOLUME

top of the market and that

of 1929.

other

Besides, there exists an¬
important difference be¬

tween

the

present

situation

both these illustrative
latter
The

cases.

and
The

already belong to history.

correctness

these

that such will be the

case

instance.

market

suffer
tent

While

Association

New York,

Mr.
of
on

TOTAL VOLUME

1ST

did

break, the full ex¬
significance of this de¬

cline remain

EFFECTIVE DEMAND

in this

severe

and

♦Talk

the

INDEX OF

market

judgments has been since vindi¬
cated. But, as the cynic Sporting
Life sings, "it ain't necessarily so"

yet unknown. And

Molodovsky
Customers'

Nov.

13,

before
Brokers

the
in

MDV.

1951.

Number 5064

Volume 174

...

The Commercial and Financial Chronicle

(1947). U

various private groups might give

Let's Have

the

Independent
Federal Reserve System!
an

One

•*

heading

Commenting on Patman Committee questionnaire sent to banks
for opinions on monetary, debt, and fiscal policies, Mr. Lanston
pleads for independence of the Federal Reserve System, and
calls upon bankers and insurance companies to raise their :
voices individually and collectively in support of this principle.
Recommends Secretary of Treasury become member of Federal
Open Market Committee and various powers of Federal Reserve;
be transferred to this Committee.

Insists interest rates must

political

out

the

Com¬

Patman

rests

were

solely with the Board, as is retary of the Treasury and the
margin require¬ Chairman of the Federal Reserve"

true in the case of

directly subjected* to ments and

consider atiohs:

should tate
in-

consumer

credit.

and real

Board

asked

disclose, ,in
differences that existed
two parties, over si
operations, which
made consistent with period of time concluded by the
it

When

es¬

comes

to, full,

are

the

between

open-market

the

iStrument for furthering the objec¬

the Board's

rates and other

with the powers each government
•"

should

tives of the Employment Act?
The second classification deals

rests

of
the
as to discount announcement
matters, the power Federal Reserve accord
with the Open Market Com-, 4, 1951.
Then follows

policy

group believes have been reposed mittee. This includes the Board of
in it, and the ' relationships that Governors and five Reserve Bank
exist' between these agencies. In Presidents.

for

this

mise

•

section

repetition

find

the

consistent

question,

does

seems

logical to expect that

will ask if it would, not

someone

the department or agency, includ¬

ing various organizational group¬
ings of the Federal Reserve, oper¬

vested in the Board.
The

ate

undei/or subject to the

powers

better

for

all

powers**

description of that

ac¬

From

observation, I would

that

the

surr

differences

may

themselves to two major

narrow

be points—one involving judgments
to market psychology and mar¬
reactions and the other in¬

ket
con¬

cerning the Federal takes the fol¬

of the President?

March"

request

cord.

outstanding question

full

Treasury

volving

principle.

The differences of judgment
lowing form: does the President
The apparent structure
may be illustrated by a question*
of
have, and if not should he have,
that was consistently in the rriinds
Suppose we start with the mem¬ thought suggested that later in the the power to resolve policy con-,
bership of the sub-committee. This hearings it might be recommended flicts between agencies and de¬ of both parties as their differences
became enlarged,
If the Federal
is the same as the earlier Douglas that the Treasury or the Council
partments directly responsible to
subcommittee, except that Frank Of -Economic Advisers be empow¬ him on the one hand, and the Fed¬ were/to withdraw gradually its
support of Treasury security
Buchanan of Pennsylvania, now ered, under the direction of the eral Reserve on the
other, or could

ious groups m
and out of the

government.
dealing
the

with

be avoided.

mittee to var-

point;

bank examination become

over-all

you .an

For ex¬ although only a handful are' in¬
ample, the Federal Reserve Banks cluded in the questionnaires sent
may vote to change their redis¬ to private groups.

to Offer
picture of the
territory covered by the Patman
questionnaire, tell you of an ap¬
proach I found helpful in studying
if, and some pitfalls that should

confronting the financial and
banking community at this time
is the questionnaire recently sent

because

could become

be helpful, I would like

One of the most important mat¬

this

adopted private banking thereby

be permitted to increase or decrease consistent with desirability
of expansion and contraction of currency.

ters

as to whether any parj count rates but the Federal Re¬
Differences Between Federal
government group wishes serve Board must approve any
Reserve and Treasury
changes to be made in the direc¬ change or no change. Thus, for
tive it has received from-Con^ practical
The first question in this series
purposes, the Board has
gress. Another
question seemed the controlling say. In the matter should produce replies that will
appropriately classified under this of reserve requirements the power interest the curious. Both the Sec¬

notes

inquiry

By AUBREY G. LANSTON*

also

the Banking Act of 1935.

consideration.

some

ticular

President, Aubrey G. Lanston & Co., Inc.

question

s*
mm

deceased, has been replaced by President, to coordinate the ac¬ such conflict be pursued indefi¬ prices, would the impact and the
consequent market instability,
Richard Boiling of Missouri. The tivities, policies, and objectives of
nitely? Obviously, indefinite con¬
prove to be more or less infla¬
other iriembers are Senators Paul the agencies and departments in¬ flict cannot be
permitted. It is
tionary, over the near term, thaii
H. Douglas of Illinois and Ralph volved. It is to be presumed that
unlikely, however, that, if differ¬

problems to
be reviewed, I
imagine that

k
wl

you, like my¬

self; may feel
overwhelmed

by the

become

theory

that

serious

discussions

As to the

and

theory

who may
effec¬

tive, perhaps a~ lengthy presenta¬
that the opinions and
able from

possibility

companies may be submerged by
bulk of the official testi¬
A resurgent determination

present your case < as indi¬
viduals, as well as by groups or

ences. ■'

be necessary
banking and
lending can continue to function
adequately and that a desirable
degree of independence will be
preserved for the Federal Reserve

headings—

ment

Federal

and

nomic

third

■

directives

objectives

groups.
Two:

offi¬

eco¬

This announcement is neither

by Con¬

given

of the government

-'PpPP^p.'P

;

■ V.

-J: //

NEW ISSUE

The

organization and
Federal Reserve.
The questions .asked in this con¬
nection were sufficiently detailed
to cause them to be treated apart.

hearings of the Douglas Commit¬
tee. This can be a plus factor of

Four:

considerable value. Moreover, for

the

Matters

directly bearing
the
the first time, questions are asked on
management of money,
of you and others that can be banking and credit, public and
•
answered from your practical ex¬ private.
perience as bankers. You, there¬

Five;

The

earnings

income

fore, can dilute the pervasive ap¬

and expenses

of the Federal Re¬

peal of some untried theories by
facts of which you have first-hand

serve

and of

ciple had to be faced. Should the
Federal, if it disagreed with the
Treasury's financing decisions and
its views of the market, continuesubservient to the Treasury or
should it proceed to act independ¬
ently to discharge its responsibil¬
ity for the availability and cost of
The

credit?
seems

Federal's

have

August,

been

knowledge.

funds

with
Congressional
times when bankers appropriations, and those of the
agencies ' who

operate

than

other

Continued

not

/ //■ /'

62,041 Shares /.

Fedders-Quigan Corporation /
Cumulative Preferred Stock, Series A, 5%

///;

(Par Value #50, #2.50 Dividend)

//:

Convertible, into Common Stock

/•/./•:
*

on or

/./'.///.■

/>///',

prior to November 1, 1961

Rights, evidenced by subscription warrants, to subscribe for these shares
by the Company to its Common Stockholders, which rights
o'clock P.M., Eastern Standard Time/on November 23,
/
1951, as more'fully set forth in the Prospectus.
have been issued

will expire at 3:00

Subscription Price $50

have sometimes demurred. This is

mental issues.

Six:

Miscellaneous subjects
directly related to the funda¬

reasonable, particularly when the

Classification number one, deal¬

have been confused and
multi-sided.
In
this
instance,
however, the issues to

be heard
heart of a funda¬
mental question—namely, whether

ing with the directives and eco¬
nomic objectives laid down by
Congress, seeks to establish cer¬

will pierce to the

tain

private banking and credit in this
country shall be dominated ai;d
controlled" by a political Admin¬

One

the right

information

and

offer shares of Cumulative Preferred .Stock, Series
A, 5%, prior to the expiration of the subscription warrants at the prices
and pursuant to the terms and conditions set forth in the Prospectus.*

The Underwriter may

question, asked only- of the
government groups, is whether
the preamble to the Employment

Copies of the Prospectus may be obtained from the undersigned, only

undersigned

may

Act of 1946 is balanced in the em¬

phasis placed upon high-level em¬

This morning, in the hope I may
address

Mr. 'Lanston

before

the Arizona Bankers Association, Tucson,

Arizona, Nov. 2, 1951.

ployment

and

price

important

place

in the

Douglas

hearings and may in this one, the

legally

offer

these

Securities in

compliance with

in such States where the-

the

Securities laws thereof.

qALLEN & COMPANY

.stability.

Since.this preamble assumed

and

voices loud enough to be heard.

*An

factual

suggest a possible revamping of
these " directives
and objectives.

to speak, their piece, in

nancial people have the duty

offer to sell nor a solicitation of an offer to buy any of these Shares,
offer is made only by the Prospectus,...
\

;

ing one arm of the government in
opposition to another, and they

istration. Private bankers and fi¬

and the Treasury
appears to have accepted this de¬
cision in the accord announced hi

member, banks. ;v.

asked to take a stand favor¬

issue may

decision

reached

1950,

//v;/./ ?:/•//../'/ / / : ■/"*'

government offices

The

Three:

powers

earlier, and admirably conducted,

are

question of prin¬

•/

and

present organization
and powers of these groups as set
up or delegated by Congress.

cleanly than was the result of the

There

Finally, the

following

the

/;•

cials should draw the issues more

ate

Federal

the

of their

order

gave

to each

gress

of govern¬

Reserve

the

The

One:

,v-

The questions asked

The

''/,/ ; /V/''/ '/'/

these

may

to insure that private

System.

President

bankers and insurance

organizations,

the

facts avail¬

the very
mony.

Independent Agency?

and

feel compelled to make an

tion. This suggests the

continuation

public and private. You also may common interest-exist between the tary objectives set forth under the
find, as I did, that upon finishing Federal and all of the other agen¬ direction of the President.
the questionnaires you have no cies or departments who received
The questions relating to the
clear idea as to how the par¬ questionnaires.
The obvious an¬ management of money, banking,
ticular questions may be related swer would be that they have a and
credit, public and private, en¬
eventually to each other, as 4o great deal in common. The im¬ compass a variety of subjects. As
plied follow-up question could be: I mention some of these, I think
differing objectives or to par¬
ticular philosophies. I, therefore, why should Or how can the Fed¬ you will agree that decisions to
rearranged the questions by sub¬ eral be permitted to stand apart adopt Certain proposals could have
J ; a profound repercussion on pri¬
ject matter as well as by ques¬ as an independent agency?
tionnaires and ended up with six
The Federal Reserve replies to vate banking and lending institu¬
different classifications, somewhat certain questions may be expected tions. For this reason, it seems to
similar to those mentioned in the .to confirm certain irrationalities me important that everyone in the
introductory remarks of the pam¬ in its organization, ones that arose financial community try to reach
phlet, but also with some differ¬ from the compromises effected in a point of view on most questions,

philosophy, will ensue from the
replies to be received. 85% of the
questions contained in the 30-page
pamphlet issued by the Commit¬
tee are directed to officials of the
Federal Government and of the
Federal Reserve System,

questionnaires, if you

them

read

■

existed

were

more and more in accordance with
classification covers should or does have the
power to
questions designed to set forth .resolve, differences arising from its ideas as to the timing, tech-r
presentation you will find that a the organization and the powers of and independent Federal Reserve, niques, and psychology involved,
its
problemsl and/ those of the
number
of questions are asked the Federal Reserve. I note here the latter would become
fully re¬
repeatedly of the different groups, a question as to what matters of sponsive to the fiscal and mone¬ Treasury were magnified.,

sub¬

these

abundance

ences

of place it apart from the others in

How Can Federal Reserve Stand

involved in

jects.

Wolcott

The Questionnaires

nique, philos¬

ophy,

Michigan and Wright Patman of this connection.
Texas, its Chairman.

com¬

plexities of
detail,
tech¬

Aubrey Gu Lanston

Jesse

gressmen

of such support?
obviously believed
empowered, he would
the answer to be "less," and the
rule against the departments and
Treasury believed. the. answer to
agencies responsible to him in fa¬
be "more." As the Federal han¬
vor of the Federal. Consequently,
dled op en-market transactions
if one granted that the President

the Federal Reserve's answers will

E. Flanders of Vermont and Con¬

November 13, 1951

page

The Commercial and Financial Chronicle...

(1848)

gram

Expanding Your Income I
By IRA U.

COBLEIGH*

sion

interim decline of some 20% by Spring

this

"Don't be

past year and
to be sort of
writer.

half I have come

itinerant financial

and

things

you're

the

First,

in.

present position and trend of the
market; and second, the wise se¬

again the 275 leVel before we sag
off
into an
interim decline of

cloistered

some

with

economists,

ably try to cover too many secu¬
rities.
I don't see how you can
carefully,

and

effectively,

couple of hundred different is¬
sues.
It would seem to me to be
a

what I call the

brush

fraternity prob¬

members of your

it would be my
far more productive of maximum
definite idea that the Dow-Jones
results to keep complete and upIndustrial Average must cross
About the first,

School at Co¬

lumbia

two

are

interested

particular securities for
purchase or sale.

Graduate

the

there

always

get rich if

sell and switch!"
Another thing that this detached
observer has noted is that some
you

lection of

After

few terms in

ties

slogan to cover it.
sucker for in and out

trading—you'll never

of buying stock should be adhered to by
Sees wide stock ownership aiding free enterprise.

has

brake on

and I have coined

practice;

corrective

investor's purpose

only possible justification
being here is tnat in the

rather effective

carrying

20%

through

perhaps the spring of 1953. This I
believe because war with Russia

got rebellious.
I
rebelled
at

seems

the drab arid¬

the mistake

ity of most of
economic

highly unlikely—she made
in Korea of arousing

too

(for her purposes) to

soon

textbooks; and
d e t ermined

defense

important
Her

Ira U. Cobleigb

depression here,

destructive

caused

perhaps by overproduction

information

minute

at the most, 40 or 50
securities in which you have de¬
say,

active interest.

veloped an

With

25,000 stocks unlisted and 3,200 on
the Exchanges
you
can't know
about them all—so specialize.
A third

point that occurs to me

is the frequent necessity of clear¬

mobilization.
ing
only hope of beating us now the

the

that with only

the

about

in the mind of your client
for which he invests!
If it's for income then by all means
up

purpose

buy for just that. If you're dig¬
we may never have to
ging for speculative profit—for
readable book on finance fight. It may well be that should
capital gains—then dividend in¬
could be written.
So I turned we reach defense expenditure in
come must often be studiously ig¬
out
a
brassy
monograph called the order of $60 billion a year, the
nored. Let me illustrate: About a
"How to
Make a K i 11 i n g in net result might be, to an impor¬
year ago an old rail trader friend
'Wall Street and Keep It."
And tant extent, the stockpiling of ob¬
of mine got all hopped up about
thinking it of dubious merit, I solescence. The technology of war
Texas and Pacific Railway paying
published anonymously. To adver¬ makes such fantastic strides with
then $5. Said he thought it ought
tise it,
I approached the Vice- each passing year as to make mas¬
to double in price—that's why he
President of a leading financial sive
production of standardized wanted to
buy it. "If you really
weekly who looked at the title items of military hardware, short
seek capital gain," I asked, "why
and exclaimed: "Why advertising of actual war, an ill-advised pro¬
don't you buy Texas and Pacific
'How to Make a Killing in Wall gram.
\
Land
Trust
at
the
same
price
Street' is picking up where Lydia
For the long trend, after say
level."
"What?" he
said, "and
Pinkham left off!"
Well, he did 1953—how can you escape infla¬
swap a $5 dividend for a lousy
advertise the book—sold widely— tion?
Annual rounds of labor in¬
Well he bought the rail¬
and I found myself in the same creases, unrelated to increased $1.70?"
road stock because down deep in
plight as the man who'd scratched productivity, a national debt that
his mind his logic was woolly. He
his 'ear at an auction sale and knows no upward bounds and that
let the dividend sway him away
found he'd bought a grand piano! no ope even dreams of reducing—
from
what would have been a
So somewhat belatedly we come these two things alone assure a
rewarding capital gain.
loused up dollar—and inflation—
now to my subject for today which
Another thing. All of us believe
by a perfectly amazing coinci¬ for a long time to come.
in our system of enterprise—capi¬
About the selection of securities.
dence
is
"Expanding Your In¬
talism. It has made this country
come"—the same title as the book By and large, I think you're doing
of my authorship which first hit a fine constructive job. There are, great and has been kind to you
and to me.
Therefore the very
the bookstalls of America on Oct. however, one or two specific
least any of us can do is to plump
30.
The book is unimportant— thoughts I do have about certain
on every occasion for wider own¬
don't bother to read it. It's just practices in
little

for

effort

war

profession which
ership of securities—to sell our
got a lot of off-beat economic while surely not common today
ideas and some splashy chapter have, at some time, tended to limit system more completely to our
your

somewhat the maximum efficiency fellow citizens and to avert a nasty
trend toward state socialism.
So

headings.

seriously, everybody is in¬ of your work.
The first of these is overtrad¬
terested in expanding income. You
do that every day for your clien¬ ing.
Going back to the different
tele whether by interest or divi- markets and far different income
But

and commission structures of

^ijoa9xd Jo 'auiooui puap
gains. And if you do
well for your clients you are
bound to expand your own income

tax

at the same time,

lure

poAixie
at

capital

Well, in your professional

du¬

the

1929

electric
nated

traders

of the

board

*An

New

address

Association

York City,

by
of

Mr.

Cobleigh before
Brokers,

Customers'

and

has

the

fasci¬

persistent

twinkling numbers in

rooms

around

often.

Nov. 13, 1951.

boards

stock

program
the

clackety-clacketing

has led some into a

churning

securities

buying and selling far too
The results of such

pro¬

even

think

and

the

among

you

funds

for

stock buying,

newcomers

and

idea

swell

encourage

larly

inconvenience

some

small

you

particu¬
investors

Wall

Street—

well find mutual
fine introductory vehicle
may

for this purpose.

Frankly yours is one of the most
fascinating vocations on earth.
Where else, but in Wall Street,
can you buy a piece of paper like
St.
at

Louis

Southwestern
in

Buck

1941

common

and sell it for

years later.
Why as you
tonight riffle through the finan¬
cial pages of your evening paper
you'll rub your thumb on at least
five listings
of shares that, by

$300 ten
All

of these shares having been publicly sold, this advertisement
appears us a matter

of record only.

299,970 Shares

will

1955,
Which

CENTRAL OKLAHOMA

recognize

PRICE $1.00

you

those

Ah,

are

when you do have the an¬
swers—please phone me!
let

PER SHARE

them?

congratulate

splendid overall job

doing

and

have

been

through the undersigned.

doing

for

the trustees

section

important

on
are

are

economy.

you
you

the investors. You

financing of this issue has been arranged

500%.
do

way,

the

The

How

peculiarly favorable position to
analyze and answer. And by the

CORPORATION)

Common Stock

gained

they?

questions which you all are by
training and temperament in a

OIL CORP.
(A DELAWARE

have

are

our

Continue your search¬

ing and patient analyses and com¬
parisons of values, continue to

Israel &
Mevibers

Nat'l Ass'n

Company
Securities

Dealers

provide for each client the very
best security list it is possible for
you

only

111

Broadway

New York 6, N. Y.

DIgby 9-3484-5-6-7

the

to assemble, and you will not
a fine
expanded

have played
drama

role in
income

but

you will have adorned the
edifice, of opportunity, enterprise

and

initiative, which is America.

■

We See It

have cre¬

could

months' holding

six

for

been

Says there is overtrading in securities; that some
customers' brokers try to cover too many issues; and that

The

Continued from first page

The 26% income tax, provi¬

ated.

of 1953.

for my

retention

tained

addressing Customers* Brokers of New York,
holds Dow-Jones Industrial Average will again cross 275 level

broker.

run

really important swings that sus¬

;

Financial writer,

before it sags into an

commissions

that

are

high, and the trader never holds
his items long enough to make

Thursday, November 15, 1951

initely begun to turn against Britain and the British Em¬
pire even prior to the outbreak of war in 1914. Changes
had been relatively minor in degree, and had escaped
the notice of all but the more discerning, and even the
keener students of international affairs had apparently
not

recognized the full implications of what was going on.
long been in considerable degree what
some one described as a
nation of shopkeepers—that is

Britain itself had

to say,

the nation which had in unusual degree made its
the other nations of the world by the con¬
of trade and other activities closely related thereto,

living
duct

such

among

shipping, insurance, and banking. Even before
goods had begun increasingly to move more
directly from producer to consumers rather than via Lon¬
don.
Other extensive primary and secondary markets
and financial centers, notably New York, were developing
in competition with London.
as

World War I

Mass production techniques, vast mechanization of
industry generally, and rapid progress in scientific ex¬
ploration and its application to the production of large
quantities of goods not previously available and which
had no particular incentive to pass through any central
market, characterized industry in several countries of the
world outside Britain, notably the United States and

Germany.

British manufacturing itself, which alongside
trading activities supplied large quantities

of the nation's
of

goods for export, had begun to feel the effects of these
developments—but had shown little disposition to keep
abreast—before the deluge in 1914.
V
,

The

events

of the

past three or four decades have

greatly stimulated the development and growth of these
tendencies. They have stimulated them, that is, outside
Britain. The British themselves have, by and large, ap¬
parently preferred to remain industrially in statu quo
ante for the most part, each man doing just about what
his father and grandfather did, priding himself indeed
upon the quality of his workmanship and by implication
at least demanding that the world outside, if it did not
want to pay a premium for "quality goods" being produced
in Britain, must in some other mariner come to the rescue
of the British
is it

as a

reward for their heroism in

sort of tribute to them

war.

(Or

growing out of their

geo¬

graphical position, and hence of their importance to nonEuropean nations, notably the United States, in their
defense against attack from Russia and Eastern Europe?)
British Attitude
Such at least has for the most part
the attitude of the British

apparently been

respects their relationships

to other nations and to other

peoples. The apparent atti¬
by
which he is immediately surrounded may well be a sort
of corollary to this basic feeling about his due from the
world in general. Of course, the plane of living of the
average inhabitant of the British Isles is not only dra¬
matically below that of the rank and file in this country,
but has fallen drastically in recent years. It was inevitable
rank and file Britisher to the conditions

tude of the

"Fair shares for all" could in the cir¬

that such be the

case.

cumstances

nothing better at best than a fair dis¬
drastically reduced total of goods and

tribution

mean

services available.

•:>;/.

Now the

accepted remedy in Britain for all this is,
generally speaking, threefold. The first ingredient in this
prescription is austerity. It may be a little difficult for
the average citizen of this country to think of austerity
as
popular in any sense of the term. In fact, it is popular
only in the sense that it is chosen and acquiesced in as a
remedy for worse conditions which are believed certain
to develop very quickly in its absence.
The second in¬
gredient is a large admixture of socialism—provision by
the government itself of those things which the individual
wants but is unable to get. The parties apparently dis¬
agree about this largely in respect of the degree in which
government shall undertake to produce that which is
wanted. The third element in this prescription is collec¬
tion of funds from other nations by skillful exploitation
of Britain's strategic geographical position. This is more

appealing apparently to the Conservative than the Labor
Party.
Basic Necessity Overlooked
Now all these

proposals seem to us to overlook one
That necessity is found in the simple
fact that the British people, if they are to remain fully
independent (to say nothing of their position among the
free nations of the earth) must find a way and find it

basic

rather

necessity.

promptly to become economically self-sustaining.

Volume 174

Number 5064

The Commercial and Financial Chronicle

way

a better plane of living, then they must find
to produce the goods and services to support it.
A complete re-orientation of British
thought and attitude

is essential.
work than

investor

Is the Bull Market Over?
-By BRADBURY K. THURLOW

They must not only be far less afraid of hard
they now seem to be, but must be much more

tion.
,

Individual initiative in these matters

veloped

on a

be removed at

must

based

de-

respond, they

and investors who adhere

Mr.

Babson, noting trend toward increase in retired workers,
holds pensions are here to stay, and oldsters are
becoming a
formidable pressure group. Says capitalism needs no
gas cham¬
bers, since increase of productivity can be applied to support
the aged.

number of occasions dur¬

ing the past two

or three
years,
the writer has felt called
upon to

act

psychiatric

nursemaid

those inves¬

BABSON PARK, Mass., Nov. 9— might

■number

workers

a s

;creased

■

in-

untile

1951

there

are

under

65.

.over

the
%

point

'•'>' '

The

for

problem

with

the

with

Pro¬

jecting

miss

seems

completely;

adult

■every

this

only five
.working adults

cause our

discovering how to preserve' full
powers of body and mind until 85,
thus deferring the average age of
retirement by 10 or 20 years. To

over

tors,

population to ex¬
In 1850 there were eleven work¬
pand beyond the ability of the
ers
under
65. years
of age for land to support it. Some have sug¬
every person over 65 years old. gested that medical science will
Gradually the
eventually solve the problem by

•

the

concerned

not

age of retirement, but
length of life after re¬

tirement.

science

succeeds

who

alii'

market

o n e

rent

...

the?

recur-i/

•

tastic

conclusions
can

indicated.

are

able, but from the economic point
when the idle of view it is
dangerous.

come

retired population will be greater
than the young and
workers
to

who

middle-aged
the taxes

ter

speculative

mat¬
K. Thurlow

history

The

each

Pensions
The vast
65

will

Here

tired
over

citizens, American industry,

operating

in¬

.capitalistic

free

taken place, but it is not surpris¬

turn

mind,

the

Dow-Jones

Industrial

once more

the

forms

familiar

during

each

The

based

international
that

fact

situa¬

the- stock

existence

investible

suggests

large

cash

and

that

For

they must recognize by now
that these flurries of nervousness

discredited

(1952

the

well be led

rying about nothing.
The major
question now, as it was a year and

great bulk of
held in safe

common

how

With the

will

stocks

deposit

two years ago,

invest¬

to seek

ment in common stocks.

the

assumed

witnessed

minor

reac¬

tions of this year and last.

the

total

little

able

only at substantially
.

- ■

(Special to

may

The Financial

Chronicle)

MIAMI, Fla.—Samuel H. Comly

higher has

•

...

fully invested and

worry^g about, every
shakeout^, :/v
j

Ranson-Davidson Adds

number

outstanding, buyers

are

longer

find the equities they want avail¬

prices.

Hits 1952 Depression Theory

percentage

have

pessimists

for

mined by transactions in a minute
of shares

still appears to be
higher stock prices
to go
before today's

much

now

boxes

that

lapse comes, practically everyone
will be fully invested and wor¬

only
should¬

weeks away, so one
n't have to wait long), this money
may

surest'.signs

to go. Rest
assured that when the great col¬

now

seven

the

the market has higher

theory of cyclical collapse in 1952
is

one

are

hands

when

investors

who have weathered past storms.

supply

their

those

confidence of

the

logic

ing to find that sentiment, fol¬ long-term\ investment, and
the
lowing a 6% reduction in the level price fluctuations of these deter¬

Averages, has

Stay

sufficient

own

;

spite of all the discouraging
aspects of the problem of our re¬

majority of people

never

Chambers

•'

market

the

tion.

may. be
as
wrong now as they
have been for the past four years.

Capitalism Needs No Gas

must pay

support them.

ness

obviously out

uncertainty. It
now

produce better
prognosti¬

empirical systems or uninformed
guesses as to the future of busi¬

suggests that these cycle theorists

cations

least one more, it still
to have many adherents.

waves

ought

chase,

results than haphazard

sumably

in response to

many

are

individual issues selected for pur¬

are

buying

to illustrate

the market

their

sitions

p o

merely

market of the past two weeks has
now and are pre¬
looking on the present betrayed an emotional lack of
confidence on the part of forecast¬
selloff as
the beginning of the
decline which will finally
bear ing services and short-term spec¬
ulators (for the third time; this
out
their long-thwarted predic¬
tions.
To the observer with a year) should do much:to fortify

major

part
stock

&
f

potential

sources

investment

they must continue to do

These followers

stretching
the
period
of adult
trend to 1960,
these waves, dating at least as
vigor to 85 or more, it is quite
•we find there
far
back as Mr. -Truman's
sur¬
likely that it will also succeed in
;Will
be
only
stretching considerably the period prise reelection in 1948, has been
"about three
motivated by a false assumption:
of
declining vigor and senility,
Roger W. Babson
working adults
bringing the problem right back namely, that current uncertainties
for every old¬
where
we
started.
From
the would cause a subsequent overall
ster. If we project to
2,000 A. D., humanitarian point of view, prog¬ decline in stock prices.
No such
which is only 50 years
hence, fan¬ ress in medical science is desir¬ overall decline has, of course,
The time

for

all

above

The

points.
Notwithstanding
implication of this theory that

the

jettison

'*1

chosen
variety of
which,
in
conjunction
(including the great one running analysis
with a sane value approach'. to
54 years)
will then reach their

appears

:
'

theory of business and
find the equities they want

and that

•.were.

the

Expects Higher Stock Prices

preparing4

that

this:

specu¬

lators,

factors

business outlook.

mediate

stocks should have been declining
steadily for at least three years

such

prevailing price level or the im¬

lowest

not

fluenced

speculation collapse in 1952 may
may not be available except at substantially higher prices.

By ROGER W. BABSON

;

therefore

ment,

investment and will
be
unduly
in¬

long-term

go before today's pessimists are fully invested
longer worrying about every "little shakeout." Says
great bulk of common stocks are now held for long-term invest¬

The Retired Old Age Problem

theo¬

but of far greater magni¬
tude.
Presumably this demand
will
come
from
funds seeking

prices must
and

equi¬

appearance,

rists,

is how much higher stock

now

its

make

to that of the cycle

similar

or uninformed guesses as to the
the international situation, Mr. Thurlow

that major question

asserts

lost.

are

influenced

of demand for

source

will

ties

empirical systems

outlook for business

If then the British people do not

once.

other

S. E.

Deploring haphazard prognostications of the stock market

wide scale. Whatever stands in the way must

preference

by iear of inflation at this time,
tnen it stands to reason that ^an¬
;

Partner, Talmage & Co., Members of N. Y.

ready to adopt and develop modern techniques of produc¬

(1849)

they want

been

added

Ranson-Davidson

the. staff ,; of

Company/ Inc.,

The writer has often expressed
enterprise, can produce plenty for
come-producing property to live
Alfred I. du Pont Building.. 7 * 7/'
Curiously enough, a large num¬ the view that the fundamental
the
aged without lowering t,the
on.
Even though
practising thrift
standard of living of the produc¬ ber of individuals still appear to force behind the Dresent bull mar¬
all their life-long,
they can lack
Joins Schwanz Staff
tive workers and their families. be clinging tenaciously to a busi¬ ket is fear of inflation and longthe ability to invest
advantageous¬
Pensions and other benefits can ness
cycle
theory,
propagated term investor preference for
(Special to The Financial Chronicle)
ly and establish financial inde¬
be
expanded slowly enough to during 1947 in a non-fiction best common stocks over bonds or cash. / AURORA, 111.—Ronald E. Wilpendence. Hence, most aged citi¬
the
next
few
seller, which holds that 1952 will Within
months,
zens must
rely on their children prevent shock to the nation's econ¬
kins has become connected with
omy.
No lethal chambers for ex¬ be the worst year for speculation large amounts of Savings Bonds
or on pensions.
cess
senile population need ever and business since 1932 because bought around the time of Pearl Schwanz & Company, Inc., Mer¬
M Many persons think the prob¬
be necessary.
virtually
all important
cycles Harbor are going to fall due.
If chants National Bank Building.
lem of the aged can be
disposed
In
a
free
capitalistic society
of by voting in favor of whatever
pensions are demanded; but this productivity per worker can be
multiplied indefinitely. It is amaz¬
is only like pulling yourself
up by
This announcement is not an offer to sell or a solicitation of an offer to buy these securities.
ing how many labor-saving ma¬
your "boot straps."'
Distribution
The offering is made only by the Prospectus.
chines and labor-saving methods
of vast sums of
money
by the
•

distribution

government to any group, whether

with

groups, unless offset by a
corresponding increase in the pro¬
duction of goods and services.

The

oldsters

are

lies

im¬

for

the

but

also

One

than

abundance

class

leisure

Oldsters.

thing

retired

more—even

economic

securitypolitical pressure
oldsters
need
the
respect
and
group. They have made California
of their descendants.
a
pensioner's paradise.
Political sympathy
Old people hunger for a share in
propsals on behalf of older citi¬
the social and spiritual life of the
zens are often
foolishly^ supported
by members of the younger gen¬ young, even more than for a share
more

formidable

eration.

tunity

*"»

They welcome the oppor¬
shift to the State the
burden

percentage

First Mortgage
Dated October

the

national

•;

-7'

'-V

•

Due October

1, 1951

--""Vy

7-:

■

1,1981

102.758%
and accrued interest

MIAMI, Fla,—Sheehan & Wolf,
Inc.

has

been

formed

with

of¬

elec¬

The

Prospectus may be obtained in any State in which this announcement is circulated from only such
of the undersigned and other dealers as may lawfully offer these securities in such State.

HALSEY, STUART & CO. Inc.

productivity.

Medical

Cooper With Da vies
Progress

Aggravates

modern

toward

factor in

birth

control

is
an

trend

large

alarm¬

ingly high percentage of oldsters

'SAN

Cooper

has

Davies

members
San

■•

■

-•

»'

■

FRANCISCO, Calif.—Jack

joined the staff of
Co.,
Russ
Building,
the

Francisco

New

Stock

York

GREGORY & SON

IRA HAUPT

CO.

INCORPORATED

Exchanges.

R. L. DAY & CO.
November 9, 1951

WM. E. POLLOCK & CO., &.
INC.
'

and

Mr. Cooper was formerly with Hill
population. -Yet, turning the
Richards & Co. and Walston, Hoff¬
clock
backward
on
this
trend man & Goodwin.,

in the

R. W. PRESSPRICH & CO.

DICK & MERLE-SMITH

(Special to The Financial Chronicle)

■

American

bringing about

■

Old-Age Problem

'■

*.;>

(Special to The Financial Chronicle)

The

fice? at 114 N. E. Second Avenue
to engage in the securities busi¬
preposterously generous incomes
ness.
Officers
are
Raymond D.
from the Federal Treasury?
This
Sheehan, President; John W. Wolf,
would be highly inflationary be¬
Vice-President
and
Secretary;
cause
it
would
put the nation
and J. S. Shdehan, Treasurer.
completely out of line with the
nation's

7',7

3M% Bonds Series D due 1981

Price

Sheehan & Wolf Formed

Will they vote themselves

torate?

Light and Power Company

>?•/ A*Vvy/.. J7'":"/; Sff''

in the wealth.

supporting
aged parents. .What will happen
when the oldsters, teamed
up with
their friends, account for a greater

•

Rockland

financial

$6,000,000

producing not only an abundance
of goods for themselves and their

Powerful

becoming

using

workers

young

children,

Politically

solution

proved machines and methods and

other

Oldsters

The

devised

can

needed.

when

oldsters,
veterans,
or
farmers,
means
making it harder for the

BYRD BROTHERS

THOMAS & COMPANY

The Commercial and Financial Chronicle

(1850)

exert

organization has
failed to accomplish that purpose.
After establishing official rates in
government economists discussed 1946, it was found that the ma¬
grandiose plans to do away with chinery set up for buying and sell¬
gold for monetary purposes al¬ ing currencies was not working
as
planned. The Fund found it
together..
\V /; '■■J

We Should Have Free Gold Markets
By HON. PATRICK A.

McCARRAN*

U. S. Senator from Nevada

Protesting gold mining industry is actually subsidizing the
United States by selling gold to it at less than world price,

;

industries < and
people are subsi¬

our

groups of our
dized by the government.

their

receive

them

.of
:

d i

Some

payments

authorized

t 1 y

gold sales. '

them

•mink

allowed to bid.

forced

was

Injustices

Besides being forced to sell

rience

-of
a

whether

vitally-needed
necessary

the miner's
little allowance
for depletion of his resources.
I

and

gave

gold producers which I know you

that

States

all remember only

govern¬

ment

sential

too well.

prod¬
its world market

value.

■ -•

the

price

any

back into the history

that

could

obtain

sation

supply.

Besides

suffering

States

Treasury basically
governed the market prices, there
;were
no
restrictions on personal
ownership or use of gold. A miner
could sell

Gold

not sell

recognized

was

tary metal and

^material; and

chose.
mone¬

industrial

raw

monetary metal

as a

it could be used
•of value

personal store

as a

without any restrictions.

By 1933
throes of

country was in the
great financial depres¬

our

sion.
•

New

ideas,

concepts of eco¬
nomics were being tried in an at¬
tempt to solve the country's prob¬
new

users

gold to their

fabricator

jewelry
from

serves

and

make

our

good

sense

told-

were

"vested

new

that

with

this

Deal

property:

had

public

period

economists

become,

interest,"

whatever that may mean to you.
As

result

gold

was

zens

could

with it.

these

vitally needed.
Price

nationalized.

Our

longer

price

citi¬

trusted

was

fixed in 1934

the

miners

and

ever

since

had

gold to the
accept payment in the

same

it.";

have

deliver their

Mint and

number of paper dollars for

•.

started

the cost of liv¬

ing of most people.
theorists

said

1933

increased

the

price

for

theories

gold would stimulate rising
commodity prices, and under con¬
ditions existing at that time there
might have been such a tendency.
But

distrust ,a

two

paper

cur¬

so-called hard paper
standard of deferred

rency, even a

currency, as a

payments.
It has often been said that

fer when

with

the

average

Under

the bad.

our

the

good

present

rights

cause

far

such

have

gold-miners

the

still

currencies

ing prices, unemployment and re¬

Bank

without

It
that

has
an

ducing
of

recently been suggested
important method of re¬

bank

could

reserves

chase

adding
the

to the volume
in this country

open

market

pur¬

sale of gold.

reprimand from the International

fallacious

theory, the gold producer became

Monetary Fund. If foreign central
banks are permitted to sell freely,
so
as
to get the greatest net re¬

price

turn

thorities.

the

bears

period.

price

set

1934.
As

the

result of

control's

this

first

victim.

still has this dubious honor.
After

the

World

War

II; Congress did away with con¬
trols on most prices.
Even rail¬
road

and

were

allowed

the
.

public

utility

rates
increased as

general cost levels

nothing was done for
producer—things were
him.
at

the

gold
done
to

The price of gold remained

the

and

But

rose.

level

the

product
didn't

established

miner

had

the

have

even

was

monopolistic
•An address

fore the

Angeles,

forced

buyer;

sell
one

Calif., Oct. 24,

fair deal and have not been taken
in

monopolistic

buyer

gold..

Monopoly

Following

the

World War I,

inflations

almost every country

in the world

adjusted the value of
its currency in relation to gold.
During and after World War II,
similar revaluations took place to
bring

about

in any form is re¬
pugnant to Americans.- We don't

between

like buying monopolies or selling

United

realistic

and
should

currency

States

relation

gold.

The

recognize

his

tolerated in the 1930s because the

else

monopolies, and
them

people had been told that this
the

only
generally.

means

raise

This practice

tinued from

emergency

was

Enemy

propaganda

Changed International Monetary
Fund

emer¬

gency. World War II came along,
and no one advocates redemption
"of currency in gold
during war
time.

prices

was con¬

could

Policy

Many attempts have been made
to stabilize all foreign exchange
and
of

currency

the

relationships.

better-known

gold

monetary

shortage of

the

world

One
is

attempts

the Executive Board that there

India

hard

the

from

western mines

rock

our

the backyards of

China.

and

know

its

eight days after
Fund

the

statement

was

with the statement,of
and that it would not

agreed

the

Fund,

change its rules and regulations
concerning the purchase and sale

gold.
The United

States, as the chief
of gold in the world, can
present rules and regu¬
lations on gold, close its eyes to
the premium markets which are
always
stimulated by wars or
rumors or threats of wars, and can
handicap its own gold mining in¬
dustry and, where gold is a by¬
product,
its
non-ferrous
metal
industry,* while foreign producers
buyer

retain its

supply
the
non-monetary
re¬
quirements of the world for gold.
By

it will lose prestige
Fund-did. ; Or this

doing

just

the

country

conditions

changing

recognize

can

economic

and

trends

that cannot be halted indefinitely

law.

appropriate legisla¬
authorize the open

tion \ it

can

purchase and sale of gold

industrial

for

Mint

restrict

and

uses,

sales solely
for monetary purposes. By recog¬
nizing reality,'it could gain pres¬
tige. Administration policy,
toward
such
legislation is con¬
trolled by the Treasury Depart¬
ment.
Will
the management of
the Treasury have the integrity
to recognize a changed situation
which requires new policies, with
the clear implication that the old
policies were wrong or have been
outgrown?
It is time that we
brought Treasury policies into line
purchases

with world

and

trends.
New

On Oct. 6, less

Policy

than three weeks

halls

has

the

many laws.
law-making

power

control

everything.

;

I'll admit that
power,

things
to

One of these

now

are

law

Just

law

old friend

in, is

and demand.
such organizations

International

find that the law

Fund

supply

soon

the

interested

and demand

Monetary
of supply

is difficult to tamper

with, and let the law operate as
it should, there will no longer be
such a problem as we are faced
This will not only
eliminate premium gold markets
by
establishing
an
equilibrium
today.

price, but it will be a democratic
way of reaching a decision on a
fundamental question.
A person
will be able to choose whether he
will

buy

gold

and the miner
he will mine

You

will

can

gold
all

that

gooseberries,

choose whether
or

Canadian^ gold

the

emergency

sistance

Act,

Gold
to

Mining As¬
market their

in the premium

production

mar¬

kets in the form of non-monetary

gold of 22 carats

The

restriction

seems

the

unwaranted

action
is

most

fineness

but

otherwise
Min¬

Canadian

the

commendable.

Canadian

The

lower fineness.

Government

adopted a statesmanlike attitude
in revising its other regulations

concerning
States

gold

Treasury
our

and the United
might well take
northern neigh¬

bors.

Mr.-1 Abbott stated
nadian

Mint

will

gold to domestic
domestic

that the Ca¬

longer

processors

manufacturers

such requirements must

gold

made

producers
ket

and

to
all

be met by

available by the gold
at the prevailing mar¬

prices.

United

sell

adopted

the

States, this would put an

end to the subsidy now given by
the United States Treasury to the

gold fabricators at the direct cost
of the gold

try.

producers of this coun¬
There is no excuse for con¬

tinuing this allowance.
The

Mint

will

continue

buy

all gold at

official prices and will
be
prepared to pay the official
price for any gold that the pro¬
ducers who elect to use the premi¬
um

markets choose to offer.

suggest,

and

prepared to

this in the form of a bill to
be introduced into the Congress if
put

galena.

remember

of'

Minister

lessons from
lot

The other, the one

Isaac Newton.

the

but there are a few
haven't as yet been able

control.

have

Abbott,

Mr.

ago,

ister

the

laws, and repeal

body

with

these world trends and conform to

by Senator McCarran be-,
Mining Congress. Los
1951.

American

currencies, no
one
is the loser.
The producing
countries gain.
And these coun¬
tries realize that they have'had a

them, rather than fight a losing
battle resisting them. The victims
of this losing battle are the gold
producers of our great nation. ;

option

desirable

seek to break

holding on and waiting for a
higher price. That was against the
law.

wherever they exist. A
monopolistic buyer of gpld was

1934

sell

Treasury.
the

the Canadian
Finance, announced
producers
meet the increased demands for.
would be granted access to pre¬
an
international medium of ex¬
mium markets. ' They could elect
change. I thoroughly agree with either to receive subsidies under
imply that there is

first discovered by our

This theory
of credit control has promise of
becoming
a
new
weapon
and
should be fully explored by our
central banking and treasury au¬

1935-1939

Canada's

official statement of the

In the

Reserves

the

liberally.

very

Executive Board of the Fund, they

them¬

Free Gold Markets Could Increase

Gold

hard

terpreted

It has been said that

rise.

discussed

premium prices for non-mone¬

tary purposes, and in many cases
the term non-monetary was in¬

many

bankrupt.

the

producing countries,
United States, were

Congress pass many^aws, amend

waited for fall¬

found

locking the door after
been stolen; since

has

gold
the

You

downward

have

horse

already permitting gold to be sold
at

cycle
supposed to benefit the
gold producer. Many of the pro¬
long

case

becomes; profitable, there
no shortage. Higher prices
will increase production, whether

which

permits

make its own reg¬

will be

system of controlled economies, it
is doubtful that we will ever again
face

which

again

decline, but suf¬

prices increase. Over the
gold producer was

presumed

witnessed by

as
-

shortage. We all know why this
shortage exists. When gold mining

the

decades

attitude,

gold

producers gain as the costs of ma¬
terials and wages

wages,

other

the

would

selves

rather

the

expectation of buyipg

duced

reflection of

those

almost every commodity has risen

in the

prices,

considerably since those dark days
1933.
The one price that has
remained static is gold. Average
prices today are nearly double

that the price of

know

users

enjoy
equitable prices for their product.
I should also like to emphasize
that the gold producing countries
also have a right to get the great¬
est possible return in dollars or

all

the

rising
So

revision

rules within

statement

except

United

the

and

States

markets have been

than

own

market

non-monetary

the

avail¬

are

realistic

most

foreigner who
levels in the

ducers who have

commodity

announced

set by supply
.77,:7:77?.7;7- J.

gold

demand.

and

again

once

services

during the years since 1940
rising prices for gold in the world

now

doesn't enter into

New

Can¬

ing to fight the inevitable.
ada

realistic appraisal of

the price of

governing the sale'of gold
purposes. This
statement is considered by some

goods for export to his own coun¬
try at a later date. In other words,

when large monetary reserves are

taken

during

was

the

dollars,

and

Kingdom,

fering gold for industrial use at
prices
susbtantially
below
the
competitive
market — especially

suddenly discovered that gold had

that

United

monetary reserves by of¬

ulations

declined

it has

year

intelligent

Any

de¬

ward
'

for

monetary usage—something great international currencies, will
hesitate to Accept these currencies

doesn't

shortages begin to
difference can exist.

each country to

has studied the price

to draw gold away

fixing of
commodities,
during World War II and
recently revived, was established
to
control
inflation.
But
gold

lem.

past

billion

cer¬

money

their

With the start

materials

which the International Monetary
Fund is anxious avoid.
It just

plete

the

able if gold is offered in payment.

consumer

only

the capacity to

demonstrating that vitally needed

vantage, with the Treasury acting
as
middleman.
This subsidy to
the

the

two

disad¬

own

things

and

Recently the International
Monetary Fund adopted a more

of the
Korean War in
June, 1950, the
gold stock again began to decline.

anywhere in the world. While the shabby treatment, the miners have
'buying and sellings prices of the been forced to subsidize industrial
United

need

United States had

tain

gold stock began to increase

perate

this

from

becomes restricted

appear,

peoples of the world were in des¬

gold between countries, but as

This difference creates a trend to¬

because most of the countries and

of course, to the closing of
gold mines during World War
II.
Many of these- mines have
never been able to reopen.
This
closing occurred without compen¬

apology, all because
of this strange state
of affairs. some government economists who
Before 1933 a gold miner could knew nothing of the mining in¬
sell the product of his labors for dustry made another mistake.
me

trade

1945

gold re¬
serve diminish by several billions
of dollars. After
World War II,

re¬

substantial difference in the price

through

international
there is no

is- unrestricted,

trade

States'

United

■

the

Sen. Pat McCarran

uct for less than

Let

1941

years

the

saw

price, but a frank
opinion as to the

States

difference

materials so
industrial econ¬
v

United

value of gold. Where

enemy

fer,

es¬

raw

our

The

mention at this point
injustice suffered by the

United

for

omy.

might

another

..was

bribe

used

taxes

subsidizing the

selling

money

the government raised

addressing

group of our

-by

form

gold

agents, encourage local resistance
to
the enemy, or - to
bring out

the

gold for less than its actual value,

people who
are '
actually

Gold Producers

clearly

was

the
medium
exchange universally accepted,

unusual

decade,

is indispensable to the suc¬
a war. During

production and demand
for
newly-mined gold have in¬
creased, and have permitted more
and more gold to be sold in the
open markets.
This has reached
such proportions as to establish a
trend—not the undermining of the

cessful conduct of

only

the

has regained
prestige by ceas¬

and

costs

finding that a stockpile of

are

gold

not allowed to do so.

were

get

Today, I have

markets, the produc¬ World War II it
American gold miners, demonstrated that

the

ers,

control,

much of its lost

Foreign countries recognize that

clear.

very

For the second time in a

which

coats.

;expe

make

currencies and

of hard

effort to

raw

Henry Morgen-

diaries of

the

thau

a price well below that
prevailed in world markets.
While
governments
themselves
operated extensively in the unof¬

not descended from heaven,

was

sell at

their

the currencies of those countries.

some

ficial world

«by law. Others
.

was

that

preventing the sale
semi-processed gold at
realistic
prices
in the
various
countries than it has to stabilizing

1934, is not a sacred figure
would have you believe.

set in

Many

Fund, nearly five

later, has finally recognized
this
situation
was
beyond

years

published. * T h e
United
States
Treasury merely announced that

and

redemption of the currency. How¬
ever, the price of $35 per ounce,

Promises to introduce bill in Senate

1° end restriction

tional Monetary

long on soft currencies. Since 1946
the Fund has given more time

and again conscientious in¬
dividuals do not
advocate gold
war,

short

was

engaged in another

Now we are

for free gold market. Criticizes government monopoly of gold
buying and Treasury's policy of
restricting its gold sales to central banks. Cites lowered confi¬
dence in the dollar, and contends free gold markets could
reserves.

Even this august

Sen. McCarran pleads

increase bank

Fund.

the International Monetary

that would be too

pressure

damaging to our monetary system.
Gold was pushed further and fur¬
ther into the background as the

Thursday, November 15, 1951

...

that

it meets with the judgment of this
announced
official Mining Congress, that the United
States Government regulations be
parities, toward the close of 1946,
a campaign headed by
South Af¬ amended to permit an open mar¬
rica was quickly started do allow ket for gold, with the necessary
sales of gold for industrial pur¬ accompanying rights of all persons
poses at
premium prices. After to own and possess gold and to
many
rebuffs, South Africa and import it or export it freely, and
many of the smaller producers re¬
that the
United States Governlaxed their regulations to accom¬
Continued on vaqe 41
plish these sales.
The Interna¬

soon

tary

after the International Mone¬

Fund

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1851)

to make up for

the inflexibility of
based on gold
coins (in responding to the fluetuating seasonal,
regional,
and

Gold—lust Another Commodity!

By C. E. WILSON*

growth requirements of the

President of General Motors Corporation

that

omy),
System

gold convertible

During

the

first

two

much of its attention to

out

the

its

i
I

realize
realize

subject

that
tnat

takine
taking

bv
by

Gold—Just

Commodity,
free

and not

power
a

Another

(2)

record

reSt0n"g

the

tremely

international

free

and

cident

lish and main¬

rich

dead

money system.
I know that

was

bullion

ionger

worst,

was

gold

an grown

mechanism.

perverse

not

wh
Such

will

fl
fluctuations

when

hold

were

common

had gold convertibility.:

Ignorant,

1 wrote

high

Gold

that

are

can

to the

gold had been.

memorandum

the

mittee. I never heard anything
from it. (As I remember*
he soon lost his job.)
1 bave always regretted that I
more

extent

commerce

traded to others for these fun-

was

uP°n request, sent it to Senator
Reed Smoot who was then Chairman of the Senate Finance Com-

com-

in addition to

used

value

subject, arid a few weeks later,

the real values in the

today.

current

hoared much

daily

our

living that these

are

is onlv valuable

trv

war"

necessary both in peace and
idea contained in this memoranGold still has a speculative value dum, for if our country had then

mechanical control,

weak>

other

many

tbe

wbat

its value in the arts and in indus-

OucUiations

and

peo-

certain non-perishable commodities that could be stockpiled or

addition to bask

so~necessarv7n

standard of

and

you

age

valuable

daily living could be pro-

Ple and temporarily stockpiled if
necessary. As a result, I looked
ink\thi matter carefully to see

mod-

our

to our

perverse

incoZTdftf prices
of money, history has
?TtLTonTTpr» LmTon ProYed that you will not get protection from

agree with

many

industrial

ern

commoditief in

f oods'are

commodities

0ur

duced by these unemployed

reasons

the~des7rability"or necessity

currencies into gold.

the econ"

harsh

f0r the free convertibilitv of their

world

discipline

other

some

are

unemployed to start
was obviously impossible since gold is only found in
a few places over the world.
It
then occurred to me that many

other

why I believe most of the world,
as
well as our country has out-

modifies

matic

un-

■

There

the

For

mining gold

Convertible Currency

Discipline is necesjn these matters but it should
be the discipline of competent and
responsible men; not the auto-

long¬

both

"
Reasons Against Gold

Other

in its effects.

dis¬

home

wise and improvident."

stand-

exerting

demands

and abroad strikes

of the currency, at

hoarding

sary

Jr.v..

The

stop.

gold

ex
ex

had

„?f convertibility
best

gold

new

and

adopted, because repeated experience has shown that internal

world, trade

exist.

standard.

to the drains of speculative

serves

as-

ard

capital

with

continuance

-0|n standard was abandoned;

possi-

conditions

peace
ice,

coveries—conditions that

stable

favorable

offsetting

gold movements

international

cur-

order to estab¬

coin

came

by the British uncier
under

im¬

exaggerated ef-

with

h^RHtifh'mdc'p"" Stab"izin,? at
0my,: and

aeement
agement

unnecessary in

tain

money

19th century was made

in itself

and that real values could only be
maintained by maintaining pro-

among nations and duction of those things that the
guide to necessary disciplines people
needed
in
their
daily
in international trade and finance, living.'
It has no useful purpose to serve
►
_*
in the pockets or hoards of the Commodities Could Be Stockpiled
people.
To expose our gold reby Unemployed

1933, when lines of
people finally stormed the Federal
Reserve Banks seeking gold, and
our
whole
banking mechanism

Free convertibility of

and

practical

the

recently

breakdowns nave alwavs made tne
Dreaxaowns have always maae the
troubles worse.

into

our

medium

was

tional accounts

embarrassing practical experience
with gold coin convertibility as

gold convertibility

cur-

rency

gold

S. Contends integrity of

such
sucn

am going on

converti-

bility

productive

gold

commodity prices. Denies gold convertible currency at
all times reduces power of governments to spend
excessively,
and holds a gold coinage system under present conditions
on our

capricious

sociated

possible only part of time and has not prevented wide fluctua¬

depends

as a

existence, the System devoted

fects

tions in

would be harmful

important
exchange than it

gold in last half century has lost its function as a medium
of exchange and is now relegated to use as bank reserves.
Says in past, convertibility of bank deposits and currency was

econ-

decades

currency is impractical and unnecessary in
order to establish and maintain a stable money system, points

that gold

was more

useful purpose to serve, chiefly as
a medium for balancing interna-

Federal Reserve
initially established,

was

clearly indicated to

can-

not solve under present economic
and social conditions. Gold has a

the

Leading automobile executive, contending restoration of free
,

lems gold coin convertibility

supply

money

because it has been

irresPonsible

by7?^

'valuable

adopted

considered to

plan for stockpiling mi-

Portent raw materials, especially
correct
Internl- already perverse. that: which is 0f people for so many centuries, those not available in our own
"len wiU Per,ert
heretic
imbalances Tn
in
when
interna
ail(j they have hoarded it directly country, it would have stimulated
tional
trade
and
they realize I
capital move¬
"Here I would
emphasize my and
indirectly as a means, of world commerce, reduced the dements. Gold convertibility within
do .no t sub¬
C. E. Wilson
view
that the integrity
of our achieving personal
security, or as mand for gold to settle^ interna—
individual countries cannot cure
scribe t o t h e
money does not depend on domes- a means of
getting greater value tional trade balances, relieved unthese basic imbalances and could
couia
gospel
according to St. Midas.
tic gold convertibility. It depends
bv exchanging it for basic com- employment and hardship not only
However, to make my position
!°n& continue so long as these up0n the great productive power modifies atsrimTlaterTime.
in
country but in Germany
clear I would like all to underof the American economy and the
*mb.a^aJlces. ex3s^;
T
f_ +hincf firmer
lino
and the other countrles of the
(5) Much of the desire for the
stand
that
I
am
dead
against
competence with which we man*sbat,Ta,
Tf world where, the unemployment
either inflation or deflation as a restoration of gold convertibility
age our fiscal and monetary afTm in iqt5 h»fTre tlTnaH™ and hardships of the people made
springs from distrust of the monenational
to

corric?U^mbTtences

millions

...

policy.

Before

;

fairs;

tary and nscal policies of the gov-

the

development of .our
banking system and espe¬

modern

ernment.

function

than

gold

and

monly

silver

used

coins

com¬

shops
I

$20

ey—a

gold

piece

Within

the

last

general

ing

™ne5TS U„Sed^Ty was m.ak~
f0r true
This

came

things

mas

1933.

Gold

presents.

Gold

had

exchange

used

and

bank

was

...

„

would

found

when

away

money pamc and

pression and

the'

had

wealth

Senate

the

kind

that

"This

and

sent

NEW ISSUE

offer to sell

nor a

solicitation of

offer to buy

offering is made only by the Prospectus.
v

V':.-.■

T'-;

memorandum

gives

...

any

of these securities.
-

•

;

100,000 Shares

Long Island Lighting Company
Preferred Stock, 5.25%, Series A

govern-

officials

there

fop

gpld

international and domestic

(Par Value $100 Per Share)

would be the hoarders and

jators

with it

for

whose

extravagances,

demands

specu-<,

for

gold
might generate panic reactions by r
the public. These and other rea-

de-

couicj

sons

unemployment.

,0f

Gold Convertibility

views in this matter closely
parallel those of Mr. Allan Sproul,
President, Federal Reserve Bank,
New York/ who spoke on
this
problem
before "the
American

dividend

stimulate withdrawals

gold -at
at

ent

,J,My

Price $100 per Share and accrued

the wrong time and
wrong time
produce results quite differ¬

Copies of the Prospectus

from;'.- those

of the undersigned

sought

the

sponsors

may

be obtained in

any

State from only such

registered dealers in securities in such State.

of gold coin convertibil-

hy.'

as are

(6) Under present world condi-

tions,

- gold"
coin
convertibility;
established by the" United States
-would - be
exceptionally

W. C. Langley & Co.

Bankers Association in San Fran-:alone

cisco, Nov. 2, 1949. The points he
made that most impressed me and
that I believe deserve
are

the

;V.,.

harmful;

because/we /would ; be
catering not only to our domestic
emphasizing hoarders but to those of the whole.
world.

following:

(1) Free convertibility of bank

'•

deposits
on

and currency into gold
demand has only been possible

for part of the time under modern,

conditions. It has generally broken
down in times of trouble and its
*An

address

Mr: Wilson at the
Eightieth Anniversary of Second National"
Bank

and

Mich.,

Nov. 8,

Trust

Company,

1951.

Saginaw,

Thus

the

whole

hoarding

demand of
demand-- oi

the
uie

verge upon

Glore, Forgan & Co.

Hemphill, Noyes, Graham, Parsons & Co.

Carl M. Loeb, Rhoades & Co.

Salomon Bros. & Hutzler

the United States' gold

reserves.

quote

this
a

world
wona

point

part

would

concon-

•

Shields &

;

Company

W. E. Button & Co.

of Mr. Sproul's ad¬

dress

which

views

quite well.

"It was,

would
wouia

summarizes

own

in part, to offset such

arbitrary and extreme influences
upon the volume of credit, and

Novemoer 9,1951

A. C.Allyn and Company

Coffin & Burr

Incorporated

Paine, Webber, Jackson ft Curtis

To quote:

our

the

the commodities which I believe

people

Committee.

might be accepted by our count?
as part payment of the war debts
and covers^my reasons for belieyContinued on page 41

needed to live on would have been
prob- created. That this was a fact

are

1932

figures in quantity and value of

nower

the things they needed to

Finance

quote:

out $3
would have
pan

nurchasing

wrote

out

most

ment

The

credit structure

thus

Views

would

they

resulted in suspension of specie
payments .by banks, precipitating
a*

T would like tn rpaH tn vnu what
liirp to read to you what
I

Fi?"v iTmfTfni
near their homeland

worth of gold, they

some point the
t ® buy
thf bud/ett' in "I3" Sveon

This announcement is neither

through * fear
panic. In addition to those
people whose potential gold with-

which they could hoard. This often
,

or sur- ■

iTinTT/m

Ta!i TnTw

X" by working all day

balance. At

pie

of, fascism, so-

money

paper

excban^e

were

Any-(lrawajs m-jght discipline

the rise

cialism and communism. It might
have even avoided World War II.

and

tune. thaKpeople got scared about
vafue

take

the

mTlinnTTf

just like it

times.

mirage—which

and

one

of the attractions of gold has been
lts suitability for hoarding.
the

themselves

whole community. These

upon
it.
Thus, gold
convertibility would expose the
country to the far greater danger,
of wrecking
the entire banking)

Unfor¬

,°?t"

situation,

manv

^'uid

suggest thah going

immediate

hTd

unemployed, j happened to

economic1 and

depending

practi¬

tunately, through the centuries

the

our

again in
nation faced

fade

primarily

reserves;

the

the correction of those

address

Possible

con-

stroy incentives throughout the

and

illusion—a

medium

as a

pius

what

and

dollar

budget, whether in deficit

Thus, plac¬
faith in currency convert-

our

nation

coins

be used for only such
directors' fees and Christ¬

cally lost its function

they

ibility into gold coin as a means
for stabilizing the economy of the

before gold redemption was

suspended

when

has been many

ing small change.
even

past

time

under those conditions

into

by all the people, and

use

beyond

the

emergency conditions. Specie payment would again
be suspended

years,

come

happened

the

some

SZ S/C/'T T" *°T
coms for tw0 weeks
work'
however, checks have

llLyu£emeCourt

has

mon¬

and

about

political life."l

tasome extent un-

over

paid in hard

tendencies

STr^tteri! S^L^ten^
politicians

—

something

was

worried

centrate

spend

'onvertibihte'"mVeh't he»~p<Stee

tne

suggest that anyone who

rize °£

Westing-

years ago

?er norn?a? conditions, it could not

individuals

trade and in the payment of
wages.
When I worked in the

house

governments

excessively and particularly to inheavy deficits.
While gold

now

were

power

has/Unttl comparatively recently,.
gold

believe

people

that convertibility will reduce the

cially the Federal Reserve System
in 1913, hard money and
espe¬
cially gold had a somewhat different

Many

Incorporated

The Commercial and Financial Chronicle...

(1852)

Addressing

summer,

meeting

the

American Bottlers of Carbonated

Beverages

D. C.,

Washington,

Nov. 13, Secretary of the Treas-

the

new

enue

rev-

measure,

is expected
that the Fedit

deficit in

eral

the fiscal year
1952 will reach

$71/2 billion,
and,
because
of this,
there
is
a

prospect

further boost

inflationary

trends.
basis

John W. Snyder

ent

On the

pres-

estimates,

which take into account the effect

recently enacted tax bill,
revenues for the fiscal year 1952
the

will still be

some

anticipated

expendi¬

Federal

announced

tures, it was
Snyder.
"The

$7.5 billion short

prospect

Mr.

this

sizable

period, as our defense
administrators have recently made
amply clear, is rapidly ending,
Already our defense program is
much larger

very

share of total output; and the proportion will increase, reaching
something like 20% by next summer. Incomes, and therefore purchasing power, will continue at
high levels.
But the supply of
goods available for civilian purchase will become increasingly restricted.
All of the goods which
consumers

their

want to buy with

may

high

incomes cannot be
turned out in sufficient quantities
to

meet demands without endan¬

gering

our

rearmament program.

strong and broadly based
program to counter the impact of
these developments on the econr

is clearly necessary.

omy
such

Under
many desirable,

program

but

period of prolonged preparation
for defense, the length of which

going to have to be postponed.
Savings must be materially in¬

one

of us can at this time pre-

diet," the Treasury Secretary also
stated.
"And
1953,"
he added,
"will
undoubtedly
bring
much
larger expenditures, as actual out¬
defense

gain

program

mo¬

nonessential, expenditures

creased.

people
der

the

are

our

going to have to shoul-

for

considerable period to

come.-

■■

"Adequate
only

are

time

same

are

substantial burden of taxa¬

tion

put and delivery under our cur¬
rent

Professors

"That

drawing off

however,

revenues,

the

first

step

anticipated

Federal government

the

defieit comes at the very start of
a

safe-

are

sent-minded.

notoriously ab¬
wonder if they

anything on the businessman
never
seems
to learn that

have
who

heavy mventones caui~
urfs an^ tria*s. a
J!
an? problems than anytking els
*a<*»
n evciyth g
else Put together,
M

certain lines,

Manufacturers
such

radio, pianos,

television,

muslins,

instruments,

musical

spreads,

and

blankets

sheetings,

mattresses, bed-springs, shoes,

toys and games, say that business
has been slow and collections have
been

It is slow for con¬
lines which have
orders for the Federal

dragging.

those

cerns

had

not

government for defense equip¬
ment and supplies of some kind
other,

those

because

are

the

lines that have been stocked heav-

ily at the retail and the wholesale
levels.
We have been

ment

stores

making studies of

condition of depart¬

the financial

About a

1931.

since

completed the study
for 1950, based on the figures of
367 department stores. Those fig¬
ures show the slowest turnover of
month ago we

of department stores
entire 20-year period,

inventory
over that

mentum.

guarding the financial system of We have also been studying the
country. Of equal importance financial conditions of seven other
wiR place on our economy is ln
bolstering the economic retail lines since 1939, that is 12
quickly evident in a brief review strength of our country are sav- years ago. Five of those lines show
of the comparative figures. As re¬ ings programs of all types. At a the slowest turnover of inventory
cently as the second quarter of time when much of our procluc- in 1950 over the entire spread of
1950, only about 6% of our na¬ tion must go for defense purposes, those years. Those lines are these:
tional product was
utilized for it is only common sense that we Retail men's clothing stores; men's
defense purposes. Most of our re¬ must
exercise
considerable
re¬
furnishings shops; installment fur¬
sources, consequently, were still straint in our personal expendi¬ niture
stores; shoe stores; and
available for civilian purposes. ture programs if prices are to be women's specialty shops.
And that fact, I might note, pro- kept in line."
Last year we had the highest
"The tension which this program

our

retail

Continued

from

page

and

this subject called

expenditures, of
for next
quantities
of money.
In other
year are the basic reason for our
high over-all business activity. I words, higher prices in many com¬
vided a sort of Indian Summer of Wanted to give you that general modities at the same time are not
plentiful civilian supplies—a pe- over-all
due to shortages in those commod¬
picture before getting into
riod which lulled many people my third point—-the fly in the ities but to a drop in the value
into believing that the possibility ointment—which is the heavy in¬ of money due to an increased sup¬
of a serious increase in inflation- ventories at the wholesale and re¬ ply of money.
ary pressures could be brushed tail levels.
Now, that is not sublime
the

John W.
Snyder stated
that,
despite aside.
ury

expenditures, and

current

The

Ointment

Fly in the

The

says

production by next

enlightening year, and are still high, particu¬
"The' larly in soft goods.
Money Illusion." In that volume,
Four:
The
trend
toward
a
Professor Fisher pointed out a fact
cheaper dollar, one which will buy
which very few of us recognized. less and
less, will continue in the
He wrote that higher costs of liv¬
years ahead, and deficit govern¬
ing are actually due to increased ment financing appears inevitable
readable

very

volume

about two months ago.

defense output will reach 20% of total
and warns resulting high pur¬
chasing power, unless offset by diminished civilian consumption
and increased savings, will mean inflationary boost.

Treasury head also

Economic Report

Congress for the

$7y2 Billion Deficit in Fiscal 1952: Snyder

tory.

turnover

sales

ever

had

the

lower sales but because of the tre¬

Facts and Forecasts of

—it is

theory
Money ac¬

everyday fact.

tually varies in value due to

sup¬

ply and demand, just as hosiery,
shoes, or automobiles
vary
in
value. That is why prices rose to
such fantastic heights in France
following World War I, and in
China
The

following

World

War

II.

thing has happened in
the good old U. S. A., but, fortu¬
nately for us all, not to the same
same

extent

in France

is what I

China. This

mendous stocks at the end of the

with the tremendous expenditures
authorized and under considera¬
tion by

Washington.

New York Air Brake
Com. Slock Offered
A

jointly by
and Dominick & Dominick offered 200,000
Barney & Co.

additional shares of common stock

of The New York Air Brake Co.,
manufacturer of air brakes and

hydraulic

inventories

date

have

been

cut

for national defense." This is what

slightly, but at the end of August
—the

last

date

for which

available—retail

are

were

mean:

figures i

inventories

25% greater than in July of

For the fiscal year

1950, the expenditures of the
Federal government for national

and wholesale invento¬

defense

ries

greater.

was

(6) Demand deposits are 4%%
higher than they were a year ago,
a new all-time high.

(7) Loans of commercial banks
are

23% higher than they were a

year ago, a new

all-time high.

(8) Finally, profits of all

corpo¬

rations for the first six months of
this year were at the annual rate
of $19.6 billion, which was 3%

greater than the first six months
of last year and 13% greater than
the first six months of 1949.

That is quite an array of facts
to place before any group of busi¬

and they are mostly new
highs. Those facts, by and large,
are favorable, with the exception
nessmen,

»v*wav**

the

v**w

v/xw

VAWU

high

inventories at the
wholesale and retail level, and
possibly the all-time high retail
price level, which continued to go
up
from May through August,
when wholesale prices were eas¬
ing.
Retail prices have never
stopped going up.

ending June

30,

last year,

23%

■

the

last

billion.

$17.6

were

the

year

That

For

peace.

ending June 30, 1951,
Federal expenditures for defense
year

amounted

$27.1 billion,

of 54%.

That

in¬

was

the first

of the Korean War.

For the

crease

year

ex¬

the

receipts from taxes and

from the

outright sale of bonds to

ceed

the public.

The difference is made

by the creation of

Simply by selling

government securities to the

com¬

mercial banks of the country, and
in that process creating increased
demand

deposits.

freight

and

year

ending

June

current fiscal year,

for

^6®*

a
a

That means we shall have

Wgher peak of production, and

higher peak of Federal expendiThese peaks will occur in

tures.

year

1952.

now

beginning July 1,

looks

though total

expenditures of the Federal gov¬
ernment for the next fiscal year—
and you can hold your breath on
this one—will amount to the fan-

year of

are

sim-

1945.

inary figures

And those prelimare

released in

Federal expenditures port of the Joint

requirements of

national defense.

cars.

pumps

for

control

are

purposes

the movement of water and chem¬
icals.

New Plateau
are

now

of Prices
new

tail,

due

crease

the

Wholesale

the

plateau
in¬

tremendous

quantity of money.

prices

went

quite

during the eight months
31, 1951, amounted to
$18,896,321
and
net
income to
$1,339,337.
For the full year 1950
the
company
reported sales of
$16,291,890
and
net
income of
$1,545,720.
Dividends equivalent
to $1.70 per common share have
ended Aug.

steadily during and following the
war,
until March of this year,

declared

been

the

Federal

government

date

1951,

with the equivalent of

share during the year 1950.

Upon issuance of the additional
shares

company's

the

capitaliza¬

tion will consist of 718,240 shares
of common

stock, the sole capital

security.

•

William W. Peake
passed
of

73.

Peake

Woodhouse

William

away

Nov.

Peake

Mr.

12 at the age
before his

re¬

the

tirement was a partner of Pell,
afraid,
Peake & Co. and for a number of
can only be accomplished through
years was Secretary of the Asso¬
more deficit spending. That means
ciation of Stock Exchange firms.
a
continued
expansion
in
our
money supply, and more and more
years

ahead which,

discuss the long-term trend of in-

only $11 billion less than the peak

Those five words

the

which

compete di¬

vacuum

sible to get production as fast as
had been anticipated nine months

✓

^as^c figure of $87 billion! That is

ply these.

with

passenger

types

During the past six months there
has been some slippage in defense
production.
Shortages in steel,
copper, aluminum, machine tools,
and plants, have made it impos¬

year.

background
words.

goods

consumer

Mutual Fund Associates
inflation over the years.
Today
position today
we
have a 61-cent dollar.
Over
(Special to The Financial Chronicle)
where soft consumer goods will
the next 10 or 15 years we can
SAN FRANCISCO, Calif.—Neil
continue
plentiful, and durable look
forward to a 38- or 40-ceht T.
Ferguson has opened offices at
consumer goods will become some¬
dollar. That is not an encouraging 127
Montgomery Street to engage
what more difficult to obtain in
outlook, but those seem to be the in the securities business under
the months ahead.
facts from a long-range viewpoint. the name of Mutual Fund Associ¬
Now let me recapitulate what I ates. Mr.
A Long-Term Inflation Trend
Ferguson was a partner

ing $48 billion for national de¬
fense, an increase of 78% over last

of this high over-all activity. That

be given in. five

those

1952, the
rectly
we~are spend-'

Second, I said I would like to
give you a brief background sketch
can

utilize metals and

30,

States

processing, and
on airplanes
and on earth moving and mate¬
rials
handling equipment.
Au¬
rora's
pumps
are
primarily for
used

$1.25

Serious

and

various

Its

compared

ahead.

United

Sales

only were inventories when prices, as I mentioned, were
at the end of the the highest in the history of our
year, but they continued to go up
country
since
1779.
Following
until May of this year. That indi¬
March, we had a moderate drop
gestion is still with us, although until August, and since then we
there has been a slight start in have had a
strengthening in prices.
cutting down stocks.
Retail prices, on the other hand,
From all indications, the pro¬
have continued to go up, and to¬
duction of textiles, furniture,
day, as I mentioned before, are
shoes, floor coverings, and soft the
highest in our history.
goods are well below capacity and
.The underlying factor, however,
will continue in plentiful supply
is the tremendous expenditures of
in
months

the

air brakes for railroad locomotives

new money

which finds its way into the hands
of the public.
And how is that

accomplished?

facturer

Not

the

December,

heavily

problems, however, appear to be
on the horizon
in the production

offering

oversubscribed and the books

Was

closed.

mean:

vacuum

agers announced that the

stock

Activity

high

and

The stock is priced at
$20.50 per share. The group marin
pumps.

year.

Economic

headed

group

Smith,

Net proceeds from the sale of
1939, before the
the stock will be used by New
war,
the money supply of the
York Air Brake to diversify its
United States, that is, demand de¬
activities in the pump manufac¬
posits and currency in circulation,
amounted to $36.2 billion. In June turing field by the acquisition of
established
companies
whose
of this year the money supply in
products complement New York
circulation, that is, demand de¬
Air Brake's hydraulic pump busi¬
posits
and
bills,
amounted
to
ness, as well as add to its line of
$113.9 billion. That is somewhat
pumps
for purposes other than
more than a threefold increase in
hydraulic control.
In this con¬
our money supply and is the basic
nection the company on Oct. 25,
reason for our higher prices.
1951, purchased Hydraulic Equip¬
Every great war has produced ment
Co., Cleveland, Ohio, and
inflation in commodity prices, and
has obtained an option for the
after each war the cost of living
acquisition of Aurora Pump Co.,
has increased rapidly. The causes
Aurora, 111.
of these inflations have always
Incorporated in 1890, the com¬
been the same. During a war, ex¬
pany is the second largets manu¬
penditures
the government
In

his-, of prices, both wholesale and re¬

slowest
certain
about not through
had

inventory

lines, that came

Thursday, November 15, 1951

a re-

Committtee

are

Fourth—I said

fiction.

would like to

That trend, started at the

have said.
One:

day at

Paul

Business is operating

to¬
high over-all level. And

while profits will be off, due to
iow point of the great depression,
jn 1932,
At that time, Roosevelt higher taxes, they will still be
said
wanted to get prices back large.
Two: The existing high level of
to the 1926 level. He succeeded.
He got them back to the 1926 level, business is largely due to heavy
and with the exception; of an oc¬ government expenditures for na¬
casional halt for breath, they have tional defense. From preliminary

Rudolph

and

Com¬

pany.

Lewis Sprague Agency
The Lewis C. Sprague Agency,
Inc. has been formed with offices
at 101 Park
the

Avenue, to

securities

business.

engage

Officers

are Lewis C. SRrague, President;
S. R. Swenson and T. J. Graham,
Federal expenditures, it
Vice-Presidents, and C. M. Stellcon- seems, will amount to around $87 jes, Secretary.
billion in the fiscal year beginning
tinue to go up in the years ahead,
July 1, 1952, compared with $70
^et me feii
why I think so.
Samuel Feinstein

reports,

kept going up ever since.
Prices, in my opinion, will

I" 1928, the late Professor Irving
Was

one°of the6 gre^Ttudente

published

money

and

prices,

billion for the current fiscal year.
Three:

Inventories

have

been

Samuel

Feinstein,

exceedingly high at the wholesale the New York Curb
and retail levels since early this passed away Nov. 3.

of
Exchange,

member

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1853)

Some industries will be less ad¬

The Outlook for Your Dividends

profits tax law
Those

in.

Bache & Co., Members New York Stock Exchange

Morgan maintains activity will be greater next

this

time

and

this world

rapidly changing economic val¬
it is extremely important that
overall

review

early ^art of the
version

security

the outlook for
di

and

many

and

from

this

could

one

tax.

this

mention

the

rubber

and

some

consumer

durable goods fields.

Other groups or individual com¬

panies
growth
dustry

qualify under the
provisions depressed in¬

may

regulated industry class¬

ifications

the

Act

there¬

and

fore obtain preferential treatment.

The

growth

provisions

the

profits

excess

tax law generally
smaller, rapidly growing

dividend

Korea

payments be

revise current spending programs

cover

carefully re¬
Many

downward. All indications at pres¬

concerns

sion, ethical drugs, light chemicals

complex fac¬

ent, however, point to maintenance
of the current projected defense

tors.

program

viewed.

both

the

domestic

governed

fields such

those with

The

new

products.

industry group
primarily those fields
which might be called "war ba¬
;

bies" such

aircraft manufactur¬

machine

etc.

These divisions of the

able

realize

period of high taxes and price

and other controls.

your

future divi¬

omy

the
a

Morgan, Jr.

Price Controls
Price

Naturally, these factors will first

controls

and

expanding
result

tools,

shipbuilding,

adversely

were

postwar period

which, after all, are the basis for
practically all dividend distribu¬

narrowing of pre-income

tions. Any developments of mate¬

the

rial

tivity indicates that industry as a

the

law

whole may

percentage return

importance

tax

earnings will
obviously be reflected* in subse¬
quent dividend distributions.

must

look

for

first

earnings and

also

expected to be particularly oner¬

make

been
made under the Capehart Amend¬
ment to
adjust price ceilings to
reflect higher costs—witness the
overall
12%
price increase re¬

health

such

as major plant expansion
improvement programs.

cently

allocated

almost

that

the

cents per

milk

Armed

for

about

and

weapons

$62.9

quart price increase for

authorized

by the Office of

metropolitan New York

supplies

The bulk of the expenditures has

Thus,
margins

been

pre-tax corporate

since the start of the Korean War.
for

hard

goods

planes, ships, tanks,
The
voted

last

indirect

defense

while

profits

costs.

purposes.

and

between

operating

prices

Administration officials,

ductions.

however,

billion

coming

before

may

would

high

seem

level

well

into

panding

are

assured

industrial

of
1953.

flected

circumstances,

This

full

employment,

its tax

re¬

pills to

ex¬

consumer

manufacture of civilian goods be¬
of material shortages. It be¬

machine will

our

increases

industrial

the

tax

are

than

lenient

duction

should

Industrial Pro¬

also

reach

new

Profits

law

are

anticipate that
business activity in 1952 will be
*Ar> address

by Mr. Morgan before the
Group, Montclair, N. J.,

Education

under

the

Women
ness,

auspices

of the Federation of
Shareholders in American Busi¬

Inc., Nov. 6, 1951.

accounting circles at

ent

the

purposes,

these

provisions

earnings

certain

ex¬

good

normal

years.

Those

companies increasing their
earning power over their normal
base

period

will be taxed at the

con¬

system, it would

holders would receive

increased

justified

earnings

for

permitted
a

the

by
the

reasonable amount for

some

tax

length the

excess

that have been able to show

rates.

plant

One of the best indications

dustry.

This is true, not only be¬

tween

unless individual managements de¬

possible future tax liabilities when

specialty producers of alloy steels,
but
also
within
the
respective
segments themselves.
Bethlehem

depreciation rates will be lower.

Steel reported

termine

The net
rate

establish

producers

higher

taxes

will

those

that

for

corpo¬

fall

civilian

were

virtual capacity in

most

goods

operating at

1949 and 1950.

Companies in these categories will
suffer a sharp drop in earnings
well threaten current

dividend, rates.

Automotive

ducers in

ler and

particular, such
General Motors,

examples, and it
the

1952

tions of these

seems

Chrys¬

are

good

distribu¬

concerns are

the

were

pro¬

quite likely

dividend

approximate

carbon

not apt

treatment

accorded

tonnage

steel

and

smarter to reduce the,tax
,

the

for

months

the

$6.50

were

respective

and

$8.96.

and

1951

third quarter earnings are under¬
stated to some extent as a result
of the retroactive provisions of the

recently enacted
but

even

year's

revenue tax

excellent

evident,

law;

the decline from

levels

•'

last

fairly

»,

Pittsburgh Steel, on the other
hand, boosted the 1951 first nine
months' net income

spite

some

35% de¬

increase of 212% in taxes.

The company reported a profit

$4,937,457, equal to $4.18

hand, some of
independent ; car

smaller

makers,

such

Packard

and

Willys-Overland, may do relative¬
ly better under today's conditions

per

common
stock as against the
comparable 1950 profit of $3,655,942 and $3.92 per share on the

higher rates.
For industry as a
whole, however, the high level of
business
anticipated
should
be

tive peacetime conditions in effect

per

shaFe results in themselves

large enough to

not

strictly comparable due to the

favorable

reasonably

assure

earnings

reports

than

and

1949 and

rowing

spite

and

of net

profits

1950.

General Motors recently showed
sharp drop in 1951 earnings de¬

dividend payments despite a nar¬

margin

they did under the competi¬

increase in sales volumes.

stock

outstanding at that time. The

offers and the retirement of

senior

Total

net

dividend

corporate profits

payments

climbed

announcement

is neither

securities.

Earnings for the first nine months
of this year

fell to $4.14

per

This

The

offer

sell,

nor a

any

of these securities.

1,150,000 Shares*,

Canadian Atlantic Oil

Company Ltd.

Common Stock

is-

*of which 25,000 shares

are

being offered in Canada by Ross WhUlall Limited

Price $6.75
per

Copies of the Prospectus
writers named in the

may

be obtained in

any

State only from such of the several Under¬

Prospectus and others as may lawfully offer these securities in such Slate.

Reynolds & Co.
•

November 15, 1JP51

some

Nevertheless

Continued

;

solicitation of offers to buy,

offering is made only by the Prospectus.

are

significant changes in the capital
structure as a result of exchange

modernizing the physical plant
setup.
.
■'
'
' /

figures

The

1950. On the other

cor¬

liability

small-lot

the

plan,

by spending funds for improving

producers
the

earnings of $1.76 per
September, 1951,
quarter as against $3.33 in the
comparable 1950 period. For nine
share

effect of

income

heavily

reserves

the

70% of

maintenance.

of this pattern is the discrepancy
in earnings within the steel in¬

profits tax law.
now

working

sharp expansion in sales volumes,
are
currently
reporting
larger
earnings despite the increased tax

However, here,
some offsetting fac¬

pay-as-you-go

retain

capital.

swallow.
are

still

and

the company to

prof¬

harder

estimated

year

corpo¬

excess

dividend

check for 10 cents per share which

likely; that actual corporate
earnings may be somewhat higher
seem

shareholders

determined per-,

were in excess of $5 million. Re¬
flecting better results, Hugh J.
Ferry,
President,
said
share¬

Other companies that were op¬

not in ef¬

were

whereas

the company's total tax

liabilities for the first nine months

erating well below capacity in the
years immediately before Korea,

statements will

Under any

tax carry¬

$885,000

will

siderably less during the amorti¬
zation period than if the accel¬
erated

possible.

facilities
rapidly

regulatory bodies and
stockholders, on the other hand,
undoubtedly be somewhat
different, although the tax charges

its in

Reports to

centage

method

proper

the

amortized

siphon off 30% of the pretax prof¬
a

pres¬

reporting depreciation charges. It
is generally agreed that, for tax

that

some ques¬

tion in
as

credit

was

Also, there is

ceptions, as briefly pointed out
above, the tax is designed to
excess

after the prop¬

fully depreciated for tax

are

purposes.

1950, Packard had

back

this year

$2 (Canadian) Par Value

effect, where only 30 cents out of
every dollar of excess profits could
be retained, it would appear far

therefore

Adult

With

hence

years

ac¬

rather

are

nebulous, however, since who can
predict what the tax rates will be

Tax

somewhat

ceiling, which is

greater

peacetime highs.
We

dividends.

years

actual benefits of

amortization

World

during

income, corporate man¬
agers
would be remiss, if not
downright foolish not to take ad¬
vantage of these cheap dollars for

and the Federal Reserve
of

and

effect

immediate

tax

ef¬

pre-tax

continue

Index

important

The

celerated

which may

question but that
the Excess Profits Tax will have
an

the

easier

Mr. Ruml pointed out that with a

national

upward

certain
,

ahead.

under the

virtually burst at the

Board's

have

porate advantages to be obtained

product should

falling

will

burden

dropped
and the

controls

price
more

effect

discussed at

trying to meet presentday demands for its output. Gross
seams

There

facilities

reported earnings of 33 cents per
share as against a deficit in 1950.

tors. In a recent article, Beardsley
Ruml, noted economist and founder

cause

evident that

too, there

purchasing
other signs of pros¬
perity despite some decline in the

comes

companies

categories.

unit

that

greater operating

rate tax rates and the

and

power,

will

The impact of

activity

will

invested

other special treatment

holding Cer¬
Necessity allowing a
five-year amortization of defense

fect.

hand, showed a sales
of approximately 36% and,
despite the sharp increase in taxes,

axiomatic

been

Taxes—Excess

some

War II.

the

present

those

meet defense costs not included in

Under

credits

in it¬
price re¬

business

and

may

considerably

appropriations already approved.

has

production

more,

perhaps
be forth¬

summer

companies

tificates

other

ficiency become evident. Further¬

the defense funds by next June 30.
$8

American

benefits

about $65 billion of

another

either

Increased production,

spent until the next fiscal period.

for

capital
for

Income Taxes

erties

the

gain

Those

five

from $7.89 for the comparable
pe¬
riod of 1950. Packard
Motors, on

controlled

requests

transport,
etc. Various

companies,
provisions have been made under

allowing

income

corporate

taxes.

air

traction

high

profits

excess

not

are

mounting

squeeze

prices

covei^ expenses for the last fiscal
year while others would not be

Additional

;

utilities,

and

stiff

somewhat, total

may ease

self, would permit

use

railroads,

sales.

profit

operating

Some of the approved funds would

expect to

area.

The regulated industries include

tax

expected to be severely curtailed

etc.

weapons,

session, of
Congress
$80 billion for direct

some

and

such 1

the basis of

the recent strike settlement in the

billion for

military

higher cost

copper;

Price Stabilization

Forces have spent or awarded con¬
tracts

tool

again, a steel
wage increase without at least a
corresponding price increase is
not apt to be granted by the steel
industry. In this connection, it is
interesting to note the latest IV2

$60

estimated

have

machine

fabricators

imported

billion for
military equipment alone. It has
been

granted

copper

staggering arma¬
Congress recently

provisions

makers; also, the three cents per
pound price mark-up allowed the

It is not feasible to predict the
future, but certain factors permit
a forecast of the
possible volume
of business activity in 1952.
For
example, the U. S. is currently
to

since

ous

finances, normal divi¬
dend policies, as well as cash re¬
quirements for other expenditures

ment program.

well be able to with¬
shrinkage of margins

some

hurting total pre¬
profits. Price controls are not

tax

corporate

committed

Nevertheless,

profit margins.

out¬

the

allowance for the

some

may

without unduly

potentialities,

ascertain

work

war

anticipated high volume of ac¬

stand

Therefore, to attempt to evaluate
the future dividend
one

some

result of

sharp drop in demand for their

earnings

output and the adjustments neces¬
sary in a peacetime economy.

corporate

econ¬

affected

volume

felt

in the face of

will

depressed

includes

ing,

dends.

televi¬

rations will

direct bear¬

ing

the

by such profit margins as corpo¬

econ¬

will have

omy

Un¬

conditions, dividend pay¬

would

ments

the

should the Korean

even

der these

picture

well

planners

problem be amicably settled.

interna¬

tional
as

military

our

steadily all through World War II

com¬

steels, oils, heavy machinery, tire

This estimate may not be realized
should
a
truce
be
achieved
in

i d u a 1

category,

when con¬
military

year

civilian

from

industries

shelter

production may still be underway.

holdings and
i

year

some

ues,

result of

as a

were
able to report
earnings in the excess
profits tax base period of 1946 to
1949 enjoy a considerable degree

higher rate than in 1951 after
initial hesitation during the

excess

substantial

than
now, and will continue high through 1953.
Predicts dividend
payments, which will depend on corporate profit margins, may
be somewhat reduced by excess profits taxation, government
interference, and welfare capitalism, but still will be satisfac¬
tory as a whole.

the

that

panies

moderating clauses included there¬

By CHARLES N. MORGAN, JR.*

Mr.

affected

versely

Bear, Stearns & Co.

page

The
Commercial

Chronicle

and Financial

...

Thursday, November 15, 1951

(1854)

■

';, '

j'i,:'..

Co. of
announced the

Nov. 2

Investment

American
Blinois
sale

■

City,

Kansas

month

reported a consoli¬

Stuart & Co. Inc: and
on Nov. 9 offered $6,000,000 first mortgage 3%% bonds,
series D, due 1981, of Rockland

i>otes due
cf

institutional investors through
$165,586, or 40 cents per share, for
Peabody & Co. and Alex. the first nine months of the year.

B idder,

the proceeds of
used to retire cur¬

Sons,

Brown

-which will be

American

rent bank loans.

Net

Invest¬

per

operating a

System operat¬ York, presently aggregating $4,totalling $7,224,- 500,000. The balance will be ap¬
390 in the nine months of 1951
plied
toward
the payment for
were $1,293,245, or 22% above the
gross utility plant additions made
same period in 1950.
Total opera- in connection with the company's
ing expenses for the 1951 period construction program for the bal¬
were $6,819,402,
as compared ta ance of 1951 and the first half
$5,474,603 in the 1950 period, an of 1952.
increase
of $1,344,799, or 25%,
The bonds may be redeemed at
with trunk lines showing an in¬ general redemption prices ranging

of $3,037,117,

stock outstanding.

dividend

preference
1

crease

12%,

Sales

Supply
totaled $14,-

Western Auto

(Mo.) in October

50,000 shares of
580,000 compared with $13,345,stock (par $5) of A. B. 000 in October of last year, an in¬

common

Chance Co.,

Centralia, was offered

crease

of 9.3%.

1951

In October,

at $12.50 per the company had 267 retail stores
of Missouri and 2,603 wholesale accounts com¬
hankers, headed by Stifel, Nicopared with 269 and 2,596, respec¬
laus & Co., Inc., and including
tively, a year earlier. Sales for
Dempsey-Tegeler & Co.; A. G. the first ten months of
1951
Udwards & Sons: Edward D. Jones amounted
to
$131,141,000 com¬
& Co.;
Newhard, Cook & Co.; pared with $127,630,000 in the cor¬
Keinholdt & Gardner; S t e r n responding period of 1950, an in¬
Brothers & Co.; G. H. Walker & crease of 2.8%.
V
Co.; Smith, Moore & Co.; Stix &
Co.; and Burke & MacDonald. The
publicly on Get. 6,
share, by a group

$24,000,000 first

issue of

new

offering,
which was oversub¬
mortgage pipe line sinking fund
scribed and the books closed, did
3 % % bonds, series'B, due Nov. 1,
iiot constitute new financing on
1971, of Mississippi River Fuel
the part of the company, the pro¬
ceeds
going to certain
selling Corp., St. Louis, has been placed
stockholders. The
Chance com¬ privately with institutional investors
through Union' Securities
pany, which was incorporated in
Corp. The proceeds are to be used
1932,
manufacturers
and sells to
repay $17,500,000 of bank loans
electric transmission and distribu¬
and the^remainder applied toward
tion equipment for construction,
the company's
1 9 5 2 expansion
maintenance
and
operation of
electric

and communica¬
also manufactures
electric power trans¬

pov/er

tion

lines.

and

sells

and power

devices

protective

line

mission

•

Monsanto
Chemical Co. of St. Louis for the
third quarter of 1951 amounted to
$67,269,310
and
for the nine
months ended
Sept. 30 totaled
$207,012,340. For the quarter, net
income was $4,647,486, or 93 cents
Consolidated sales of

1951

tax

act and

earnings

1951

$736,000

were

ment

with

in effect.

trustee

Connecticut Light & Power

The

applied to the Pub¬
for per¬
mission to sell its main gas trans¬

Company has

Utilities Commission

lic

facilities to a subsidiary,

mission

Company,
12,250 shares

Gas

Connecticut

The

for up to

return

$100 par stock. The subsidiary
own and operate the lines

would

presently transport manu¬
gas from New Haven to
construct and

which

factured

Hartford and would

Haven

mixing

plant at New

manufactured

where

gas

under * longrterm con¬
tract from The Connecticut Coke
Company would be mixed with
natural gas to be purchased from
Algonquin Gas Transmission Com¬
pany, The mixed gas will be pri¬
marily for Connecticut Light &
Power,
Hartford Gas and New
purchased

700.

Missouri
been authorized

for

Security Analysis

the

delphia wlil hold their second
meeting of the 1951-1952 year on
Monday,
Nov. 19,
at Kugler's.
The speaker will be Daniel Fran¬
cis
Horseman.
Brickell,
O.B.E.,

Philadel¬

British Consul General,

June

30,

ended

company's

fiscal

the

for

with

the

World

McKinney

Investments

gage

of¬ Philadelphia,

with

University to en¬

in the securities business.

War,

5:20

same

Ahwaz

Persia.

has

Grant

Mercantile Trust

Chronicle)

•

Hamilton
Corporation,
445

joined the staff of

Management

Laclede Steel

turer

Street.

thor

fi¬

and au¬

nance

"The

Intelligent In¬

will

vestor,"
speak
"p

Benjamin Graham

on
t i c a 1

r a c

Techniqu e s
for

Appraising

Analyzing Individual

and

Issues."

Royal Type¬ He is guest lecturer in the series
meet on "Your Investment Problems To¬
Nov. 14 to vote on a proposed in¬ day," by A. Wilfred May.
crease
in the number of author¬
ized common shares from 1,078,of

Stockholders

writer

DENVER, Colo.—John F. Lamey

816

Company

2,000,000.

announced

for

been

will

Herbert T. Tomlinson

plans have
of

issuance

the additional stock.

Herbert

partner

Russell Manufacturing

Company

Tomlinson,

Moore,

Lynch, passed away Nov. 7.

•

in:

primary markets

■We maintain

limited

Leonard

Moloney Electric Class "A"
MEMBERS

Scruggs-Vandervoort-Barney Com. & Pfd.

MIDWEST STOCK EXCHANGE

St. Louis Union Trust

Stix Baer & Fuller Dry

securities

connecticut
CONNECTICUT

LIGHT

POWER

CONNECTICUT POWER

Goods Com. & Pfd.

•

HARTFORD ELECTRIC

UNITED ILLUMINATING

•

NEW HAVEN GAS

LIGHT

•

LIGHT

HARTFORD GAS

Wagner Electric
memoranda available on request
other Connecticut companies.

Descriptive

Bought

—

Sold

—

Stix & Co

Quoted

SCHfRCK, RICHTER COMPANY

sos olive

street

Midwest

Landreth
Bell Teletype
SL 456

Stock

these

and

chas. w.

■»
'«

Member

MEMBERS

scranton 6- co.

NEW

YORK STOCK

EXCHANGE

Exchange

st. Louis 1,mo.

Building

St. Louis 2, Mo.

Garfield 0225
L. D. 123

20,
Mr.
lec¬

p.m.

Graham,

sj:

held

Tues¬

Nov.

day,

and

Brickell

(Special to The 'Financial

Ely Walker Dry Goods Com. & Pfds.
Bank

the

Mr.
office

12th

Street,

British

With Hamilton Manage'nt

Boatmens National Bank

First National

the

West

1951 shows that
sales rose from

as a
capital rose from $3,740,886 to
Foreign $6,671 845 and the book value per
Service in Turkey, Greece, Egypt, share from $12.45 to $14.55.
In
;
Harrison & McKinney
France and Iraq.
He also has September
$1,698,000, obtained
been British Minister to
Para¬ from sale of plants and equipment
(Special to The Financial Chronicle!
GAINESVILLE, Fla. — Joe K. guay and San Salvador, as well as in 1951, was used to reduce the out¬
Consul General at Detroit. Before standing 4% sinking fund deben¬
Harrison and Howard T. McKin¬
his appointment at the beginning tures, due July 1, 1965, to $2,077ney
have formed Harrison and of this year as Consul General in 000.

Re-

search,

year

served with $22.2 million to $26.8 million and
a Lieutenant
earnings per share from $2.51 to
Royal Flying Corps in
$2.55. During the year working

First

the

School

for Social

report of Aspinook

The annual

Corporation

New

s;:

the

gram"

basis.

Mr. Brickell
the British Army as

phia.

member

fices at 115 East

Airlines, Inc.,

natural

operate

facilities at St. Louis.

dividends,

compares

■

earlier in the year that,
gas would
be availiable
in time to eliminate the necessity
of a rate increase.
The effective
date of the new rates was Nov. L

hoped

new

aggregate population of about who formerly produced ranges,
and water
As of the same date gas washing machines,
service was
supplied to 11,913 heaters.
meters in 13 communities having

equipment program and for en¬
largement of diesel engine repair

Mid-Continent

par and at special ges, washing
prices receding from heaters to a

123,000.

$3.87 a common share earned dur¬
ing the same period in 1950 under
■

Clark has sold
Universal electric ran¬

The

equivalent to $3.34 a com¬

the tax laws then

line of

amount

$329,000 annually. The increase
was required
to offset additional
taxes and rising costs. It had b:en

Landers, Frary &
its

estimated to produce

additional revenues in the

•'

costing not less than $5,906,-

250.

excess profits
earnings, after pro¬

This

v.'f.v,

■

Women to Hear

adjustment of

preference

for

share.

mon

after adding to

'**

•

Graham to Discuss

1950

taxes. These

vision

rates in¬

recently-enacted

corporated in the

-#•

sion which is

Stockholders of Silex Company
approximate population of 80,Rockland
Electric Co., a have approved an increase in the
subsidiary, serves 22 communities number of common shares author¬
in Northern New Jersey having a ized from 215,000 to 500,000.. It is
population of approximately 31,- planned to offer 53,750 shares to
600.
Pike County Light & Power stockholders of record Nov. 13 on
Co., also a subsidiary, serves five a one-for-four basis at $5. Rights Haven Gas.
program.
Pennsylvania communities with will expire Nov. 30. Any shares
St. Louis-San Francisco Ry. Co., electricity and one with gas.
up to 50,000 not taken up through
will until 12 o'clock noon (EDT)
rights will be purchased by two
on Nov. 26 receive at its office at
individuals
not
presently con¬
120 Broadway, New York, N. Y.,
nected with the company. The net
for the purchase from it of $4,proceeds of the offering will be
added to working capital.
Silex
/25,000 equipment trust certifi¬
Benjamin Graham, President of
cates. series J, to mature in
15
is
working on development of Graham-Newman Corp., will
PHILADELPHIA, Pa.—The In¬ several new products and opera¬
equal annual instalments and to
speak on "Planning a Specific In¬
vestment Women's Club of Phila¬
vestment Pro¬
be secured by new railroad equip¬
tions are currently on a profitable

while for the

profits taxes at

•

has obtained a rate increase
Public Utilities Commis¬

from the

machines and water
company, Uni¬
102.74% to, par, plus accrued in¬ versal Major Appliances, Inc., with
plants in Baltimore and Lim^,
terest. in each case.
Rockland Light & Power Co. is Ohio. As a result of the sale, Lan¬
engaged in the business of gener¬ ders will have a substantial mi¬
ating, manufacturing, purchasing, nority interest in Universal Major
transmitting, distributing and sell¬ Appliances, but will take no part
During the
ing electricity and gas for lighting, in its management.
heating, Industrial and general past two years Artcraft Manufac¬
utility purposes.
The company turing Corp., one of the organizers
of the new company, has been
serves practically all of Rockland
County and parts of Orange and producing Universal refrigerators
Sullivan Counties in New York under contract. Landers will con¬
State.
The territory
served is centrate on vacuum cleaners,
about
625 square miles.
As of small electric appliances and
The company
July 31, 1951, the company fur¬ hardware lines.
nished electric service to 44,145 hopes to obtain defense contracts
meters in 32 communities having to
provide work for employees

of 1951 net Pacific RR. has
amounted
to
$16,687,188,
after by Federal District Court at St.
provision for Federal income and Louis to spend $9,223,946 on a rail
excess

v/:

•

pany

Bridgeport Gas Light Com¬

The

Phita. Investment

switches!

per common share,
.first
nine
months

'j'"'

foot

square

❖

plant at
Longview, Texas.
Earlier this
year the company received a cer¬
tificate of necessity on the $4,796000 to be spent for the new plant.
250,000

105.74% to

from

redemption

of $664,901, or

re¬

issue

to postpone indefinitely
announced plans to construct

the

revenues

Co.

•

The

decided

quirements.
.

group

Doroshaw.

ing

1,955,176 shares
This
compares with, a net of $3,230,561
lor the same period of 1950, equal
to $1.66 per common share after
adjusting for a 25% stock split
iate
in
1950. Earnings were 29
times

ment

period last year.

$1.50 per share on

of common

compared to $246,418, or
cents per share, in the same

preferred dividends to

equal after

nine-month pe¬

share for the

riod, as

chain of 213 consumer

earnings after taxes,

profit on the company's trunk
was $227,374, or 54 cents

routes

nation-wide
loan offices
in 20 States, for the nine months
ended Sept. 30, 1951 reported net

ment Co.,

rights to purchase one new,
for each ten owned at a:

headed by Jennis M.
sixty-fivje year price of $15.75. Proceeds of the
issue to be added to working cap¬
old company, located in "Bristol,
ital to meet the requirements
produces fishing rods, reels and
Light & Power Co. at 102.738%
brought on by higher prices and
golf clubs. Among the 250 em¬
and accrued interest.
an
increase volume of business.
ployees is Ted Williams, Boston
Proceeds
of, the issue to the
The company has also arranged to
Red Sox player, who helps pro¬
extent of at least $3,684,000 will
sell $1,600,000 of notes to an in¬
motes the company's products.
be applied to reduction of out¬
surance
company to replace the
standing short - term borrowings
former
notes in the amount of
The Whitney Chain division of
from the First National Bank of
Whitney-Hansen
Industries has $1,114,000 and to provide $486,000
Boston and Bankers Trust Co., New
of new money.

associates

$20,000,000 15-year 3%%
provision for income taxes at the
Oct. 1, 1966 to a group 1950 rates, and a net profit of

Oct. 17

purchased by an invests

has been

stockholders of record

offered its

Manufacturing

Bristol

Her ton

Halsey,

profit of $35,293 for the
September, 1951, after

dated net

Connecticut Brevities

Halsey, Stuart Group
Offer Utility Bonds

Missouri Brevities

NEW
New

HAVEN

York: REctor 2-9377

Telephone 6-0171
Teletype: NH 194

Hartford 7-2669

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1855)
held in the board
rence

News About Banks

moved

CONSOLIDATIONS
NEW

the

when

business
19

when

made

was

the

branch of Bank of Amer¬

new

ica

(International)
in

opened
under

Dusseldorf,

the

Banigan,

has

been

Germany,

management of Carl
Californian long asso¬

ciated with Bank of America Na¬
tional Trust & Savings Association
of

San

Francisco.

of the

opening

Announcement

made in Ger¬

was

many by Russell
bank's Executive

Smith, the
Vice-President,
who had journeyed to Dusseldorf
following his participation in the
recent

International

•

ference in Rome.
that

cause

its

commercial

Germany.
provide

Credit

chosen

was

key

industrial

position
The new

special

be¬

and

Western

branch

will

banking facilities

for Americans in

Germany, assist
implementation of German-

in the

American trade, and serve as Bank
of America's general
representa¬

Elmont, Levittown
and Rockville Centre; on Sept.
30,
1951
total deposits
in excess of
$83,000,000
were
reported
and
total

resources

000,000.

Upon

excess

$90,completion of

the

the financing and after giving ef¬
fect to a recent stock dividend the

capitalization will consist of 279,000
shares
representing capital
surplus and undivided profits of
in

excess

$6,000,000.
«

Con¬

Mr. Smith stated

Dusseldorf

located

are

Bank

*at

The Bank of Babylon, at Baby¬

lon,

Long Island, N. Y., has re¬
ceived from the New York State

Banking Department approval of
certificate of increase in its capi¬
tal stock from $175,000,
consisting

3,500

shares, par $50 each, to
in shares* of 4,500, par

$225,000

$50 each.

branches

in London,
Manila, To¬
Yokohama, Kobe, Bangkok
Guam, and maintains repre¬

kyo,
and

sentative

offices

146

Leadenhall

Streetr London, E. C; 3, on Nov.
19, with George E. Putnam, Jr.,
as special representative.

camp

ended.

the

Georgia

Soon

Alto,

Alto.

Bank

cisco

America's

headquarters.

San

years

Fran¬

iers.
Credit

National

City
ap¬

are

the

Personal

Florence and

and

E. Chester

the

42nd

National

Bank

and

Trust Co. of New York, announced
on
Nov. 7 that John S. Kozick
arid John Marshall of the midtown

office, 39th Street and Broadway,
were appointed Assistant Cashiers.
ft

■

A certificate

-M;""''

ceived

its

$1,000,000 to $1,250,000,
by

the

New

the

Trust

from

was

York

ap¬

State

Banking Department on Oct. 31.
The stock is in shares of
$10 each.

Bank

National

growing local institution
were
given the privilege of sub¬
scribing to one new share for each
three

shares
was

already owned.

The

bank's stock will

$54

Mark

elected

excess

Crocker

house

Assistant

Except for naval
service during World War II, Mr.
Stewart

had

been

with

the

Chi¬

cago office of C. J. Devine & Co.
for
15
years.
Mr. Stewart will
continue to be based in

Chicago

will

represent Colonial Trust

in the Midwest area.

San

ized

account

has

000,000 by

Nov.

tional

Bank

President.

Philadelphia, it is
C. A. Sienkiewicz,

Mr.

appointment

tion Uo

the

share.

per

offered

for

The

subscrip¬

stockholders

the

becomes

Corn

Exchange

National

join Central-Penn.

Bank

proceeds
the

relation

bank's capital position in
to
its
outstanding loan

deposit

continued

liabilities

expansion

the

bank.

it claims

bank engaged

ing

business

Long Island.

in
in

of the

will

the

personnel

well

versity
the

he served

war

the

Pennsylvania.

that

will

pro¬

and

the -company

$25,000,000
expended

last

major portion of the
1952 and 1953.

six

com¬

Howard

months

electric

and

highly

area

Norbert A. McKerma

Announcement

has

been

during

1951

Lawrence & Sons and Mr. Mc-'

Kenna
&

partner

Reynolds

Co.

and

balance

With King Merritt
(Sncciai to The Financial

Chkonicle)

diversified

Population of

area

186,515.
sidiary,
nated

with

served

both

wholly

Public

owned

Service

Transport,

sub¬

Coordi¬

all of the

owns

Joins Francis I. du Pont

elec¬

(Special to The Financial Chkonicle)

'FT. LAUDERDALE, Fla.—Rich¬
ard

Harder

now

associated

with Francis I. du Pont &

East

Las

Olas

Boulevard.-

he construed as an offering
of these securities for sale,
•solicitation of any offer to buy, any of such securities.
The offer is made only by means of the
Prospectus.
or as

NEW ISSUE

200,000 Shares

THE

NEW

Naval

YORK AIR BRAKE

COMPANY

Common Stock

Lieutenant

Reserve

(Par Value $5

per

Share)

Price $20.50
per

personnel capacity with the civil¬
ian

staffs

lishments.
ward

of
In

Naval
1946

Shore
he

Estab¬

joined Ed¬

Hay & Associates, Inc.,
Philadelphia management consult¬
ing firm. He became personnel
at

the

former

Corn

Ex¬

Copies of the Prospectus
tvhich

Administrators,

several

published papers

sonnel

techniques, and

board

the

author

directors

per¬

•;

•

'Fred
the

he obtained from the undersigned only in those Stales
may legally offer these securities in compliance
laws of the respective States.

may

day

with

the

securities

Smith, Barney & Co.

Dominick & Dominick

Blyth & Co., Inc.

the

Harriman

Glore, Forgan & Co.
Ripley & Co.

Incorporated
•

Merrill

Goldman, Sachs & Co.
Kidder, Peabody & Co.

Lynch, Pierce, Fenner & Beane

Florence, President of

Republic

National

anniversary

Bank

Nov.

general bank¬

the officers and employees of the

County,

bank,

Besides its main of¬

rence

Karl

was

undersigned

member

the

Stone & Webster Securities

presented

Mr.

Flo¬

by Chairman of the Board,

Hoblitzelle,

ceremony

White, Weld & Co.
»

Corporation

Union Securities Corporation

A. G. Becker & Co.

Clark, Dodge & Co.

Incorporated

Hemphill; Noyes, Graham, Parsons & Co.
November 15,1951

•'

including most

tricity and gas is estimated at 3,-

buy,

'. DENVER, Colo.—John N. Rea is
now with King Merritt &
Co., Inc.,
U. S. National Bank Building.
industrial

principally
in the
gas business, serves

in New Jersey

circumstances

mad£Y

Cyrus'

Y The company, an
operating util¬

engaged

Halligan

of the elections of Howard K. Hal¬

during
ity

During

antique silver tureen, a gift from

and

Precision Equipment Corporation."
Mr. Halligan is a partner of

leader, celebrated his 60th birth¬

fice at Franklin Square, branches

largest

Nassau

electric

the

$6,000,000.

offer

30,

General Precision Elects

busi¬
in

J'une
,

portion

the

.Capital

Dallas, Texas, and prominent civic

Chartered

ended

$43,804,781'.

additions
the

Of (he total

charge of the selection and devel¬

the

and

months

were

approximately
$95,432,000

the

Chamber of Commerce.

such shares will be used to main¬

1951

Philadelphia Safety Council of the

23,578 shares.
from the sale of

the

which

surplus

This is under

Vice-President of the Girard Trust

ing subscribed

1926,

been

Credit

effective

bank who pursuant to such offer¬

for

of Trans¬

Dec. 1, leaves the post of Assistant

sonnel

were

$23,030,053.

port and Interstate companies for

ligan and Norbert A. McKenna as*
additional directors of General-

of its larger cities.

Kirchgasser, whose

delphia Association of Bank Per¬

Y., priced at $40

was

revenue

po¬

Franklin

author¬

June

purposes,
a

1951

applicable

improvements

transfer of $2,000,000

unchanged

but

construction

reserves.

operating

charge

of The Franklin National Bank of

ness

$107,000,000

$14,000,000 to $16,-

general

30,

the

income

net

of personnel of Central-Penn Na¬

director

Square, Long Island, N.

June

current

amounted

was

Council

Bank

and

Total

been

newly created

sition of Vice-President in

increase
from

corporate

.•

National

Francisco

An underwriting
group headed change Bank in 1947, and he was
by Blair, Rollins & Co. Inc. is of¬ elected Assistant Vice-President of
fering the unsubscribed portion of the merged Girard Trust Corn
an issue of
25,000 shares of capi¬ Exchange Bank this past June. He
tal stock (par value $10
is a past President of the Phila¬
per share)

and

graduation from the Uni¬

banking

Vice-President.

tain

general

gram

Bankers Association;

First

thereafter

31, 1961, and on
Nov. 1, 1961 at $103.

pany -s

President,

-I'.}

ended

redemp¬

Oct.

estimates

remains

Kirchgasser
the

fore

1929.

Chairman,

months

before Oct. 31, 1957 and at
$104
per share thereafter but on or be¬

plant.

recently

Republic

Executive

the

30, 1951 operating revenues of the
company alone were $197,143,383

accrued

bursement of its treasury for ex¬
penditures made for such purposes
and for retirement of
long-term
debt.
■
.,
-

Director of Re¬

Bankers;

States.

For

time, at the option of

member of the

Arthur S. Kleeman, President of
administration.
Mr.
Kirchgasser
Company of New joined the Pennsylvania
Company
York, announces that John W. for
Banking and Trusts shortly
Stewart has been associated with after his

The

and

single
fleet
operated
in
mass
transportation service in the Uni¬
ted

funds required for its con¬
struction program, toward reim¬

Clearing House; Past Pres¬

Colonial Trust

and

the

Jan.

Service Interstate
Transporta¬
Company. Busses of the two
companies comprise the largest
tion

approximately

including provision for

re¬

charter

plus

of Pub¬

lic

of the

to the Republic
of
Dallas.
Mr.

Bank

City

Dallas

from

share.

per

Service

outstanding capital stock

Proceeds, of the sale will be used

only 38 when he be¬

was

Florence is

serve

bank

$102.17

any

per

for

this

opment

the

name

President

came

this

national

changed its

Mr.

1923

issue

new

Public

stock is subject to

$105

result Mr. Flo¬

the

Guaranty Bank
Trust Company as First Vice-

President.

tion

after

increase its capital stock
Policy Commission Committee of
$150,000
to
$200,000
and
surplus from $250,000 to $287,500 American Bankers Association.
#
&
jit
'
v
v.--,-.:''
b,y the issuance of 2,500 new shares
at $35 per share. The stockholders
The •; board
of
directors
of

announced

of increase in

capital of the American
Company
of
New
York,
proved

recently

substantially oversub¬
scribed,;, The book value of the

Gersten, President of

Public

joined

rence

voted to

issue

Department

Street Branch.

The

Company,

the

Nov. 7

Brady and
J. Kine, Assistant Cash¬

Both

President,

the company, at $106 per share
or
before Oct.
31, 1953 and

Directors of the
Bank of New York
William

from

fhyp

pointed
Richard

Edgar,

Trust

ident, Texas Bankers Association;

The stockholders of The Citizens

was
President, looking for a
Vice-President,
turned
to
Mr.

of American

recent

terday (Nov. 14)
249,942 shares of

The

who

and

Republic Na¬
Bank, opened for business
in February, 1920. W. O.
Conner,v

W.,

served

the bank
elected Mayor

and

forerunner

Trust Co. of Summit, N. J., Harry

both

offered for public sale yes¬

dividends to yield
4.60%. *

war

return

was

have

the

his

the meantime the Guar¬

Bank

anty

training

when

after

Presidency

Paris, Zurich
and Milan.
Mr. Banigan and As¬
sistant Manager
George Ullmann,
Jr., a former European banker,

•Y

& Co.

priced

commission at

Florence

office

com¬

firms

headed by Morgan Stanley &
Co.;
Drexel & Co. and
Glore, Forgan

ceived

The First National Bank

tative

group,

investment

(New Jersey)
enlisted at Love Field in what is' 4.70% cumulative preferred stock
of $100 par value. The stock
now the U; S.
was
Air Force. He re¬

National

ot Bos¬
tive in Germany which, in addi~;
tiori to its 528 branches in Cali¬ ton, Mass., announces the forth¬
coming reopening of its represen¬
fornia, o p e r at e s international

Electric & Gas Co.

underwriting

prising

tion of President of the Alto Bank.With World War I, Mr. Florence

tional

Alto, Texas. In 1915, at the age
of 24, he was elected to the
posi¬

■JA

Serv. El. & Gas Pfd.

He entered

At 17 he had risen

Vice-President

CAPITALIZATIONS

Bankers Offer Public

parents

Rusk, Texas,

years of age.
to Teller and

Bankers

and

REVISED

His

1891.-

banking

BRANCHES

NEW OFFICERS, ETC.

three months old.

was

Mr. Flo¬

room.

born in New York City

was

Nov.

Lee Higginson Corporation

Co., 455

The Commercial and Financial

(1856)

cracking facilities, but it does
process about 170,000 barrels per
day and, together with Bahrein
refinery,
furnishes* our
armed

Middle East Oil and
Product Availability

of fuel and diesel oil.
In

By R. G. FOLLIS*
Chairman of the Board, Standard

addition

erected

and

Standard Oil executive reviews Middle East oil situation

ducers

have

need

area

is not cheap

Arab

Reports U. S. has

A great deal

of attention is cur¬

focused

the

upon

Middle

The

ranean.

transporting of 265,-

of steel from the United

000 tons

States, the building of roads along
the route, and

Middle

the actual laying of

pipe #nd construction of six
pumping stations in temperatures
and the crisis in Egypt. Although
that reached 130 degrees F was a
I shall touch further upon these real engineering feat. The greatest
latter points my talk to you is problems, however, were not of a
concerned primarily with Ameri¬
physical nature. After crews were
can oil operations in the Middle in the field and the line being
East.
Laid, the Department of Commerce
suspended the issuance of export
i
Middle East—Reserves and
licenses for a year. Serious rightI.
Production, and Pipe Lines
of-way difficulties also developed,
First let me say that by the aggravated by political assassin¬
Middle East I am speaking of the
ations and-changes in government.
countries
between
the
Eastern However, in December of 1950
East oil, and now the press daily
headlines
the
Iranian
situation

India.

and

Those

started

tankers

Arabian

most important from the point of

oil at Sidon and the $200 million

view of oil

privately-owned and financed job

are

Iran, Iraq, Kuwait,

and Saudi Arabia. These countries

alone

have

known

reserves

over 40 billion barrels compared
to 25 billion barrels of proven re¬

serves

Further¬

country.

our

more, we all realize it is becoming
more and more expensive to find

was

done.

During 1951 almost two-thirds
of Western
Europe's petroleum
requirements continued to go by
tanker through the Suez Canal
from the Persian Gulf. Although

the completion of the expansion
here, whereas the poten¬ of the Iraq pipe lines will reduce
tial of the Middle East has hardly this
quantity materially, we will
been scratched. For example, peakf still
depend on Suez for a sub¬
production of that area last spring stantial movement of oil. This is
before Iran was shut in was 2.2 another reason for concern over
hew oil

million

barrels

day

per

annu¬

ally less than 2% of the indicated
reserve.

United

the

are

producing

per

day which,

States

million

6
on

barrels

yearly basis,

is about 9% of our reserves.'

Except for the Kirkuk Field in

Egypt's recent unilateral cancella¬
tion of the 1936 treaty with Great
Britain. If the canal is closed,

tankers would be re¬
the oil around
Africa. I don't know where they
many more

quired

move

could be obtained.

Iraq, all the Middle East oil fields
Middle East Refineries

close to the Persian Gulf and,

accordingly,
moved

most
to

market

the crude
by tanker

from Persian Gulf ports.

Increas¬

Although there
of

The

original

East

Iraq

Petroleum

Company pipe lines that were
completed in 1934 terminated in

oil

the

partly

crudes that

refineries

ex¬

Middle

replaced other
in European

were run

the

before

and

war

Haifa and Tripoli, and had
capacity of 90,000 barrels

total

day,

flow through the Haifa line, how¬
ever,

stopped by Iraq early

was

in 1948 because of the difficulties

With

Israel
resulting from the
partition of Palestine in Novem¬

ber, 1947. This line has been
used
to

since

Tripoli

un¬

then, but the capacity
has been increased to

135,000 barrels daily. A
inch" line is

now

new

"big

under construc¬

tion,

and is expected to go into
service in the spring of 1952. The

war

partly because of the tendencies

the

Mediterranean

terminal

Sidon in Lebanon, about 25 mile3
south of Beirut. This project prob¬

ably encountered

obstacles

distillation

day

per

units,
of

• 130,000
cracking and

der that its shutdown has

the distribution of oil

importance is the re¬

finery on Bahrein Island owned
by the Bahrein Petroleum Com¬
pany

ing

Limited. This plant—strain¬
help
fill
the
vacuum

created

by the Abadan shutdown
processing nearly 200,000
of crude. This also

—is

taking abroad. The route that was
finally selected crosses sand-dune
country in the east, then 750 miles

barrels per day

absolutely barren desert land,
finally two mountain ranges
before
reaching
the
Mediter¬

by Mr. Follis at the 31st
Meeting of the American Petrol¬
Institute, Chicago, 111., Nov. 7, 1951*

eum

now

complete plant with thermal

and

catalytic cracking, S02 treat¬
ing, asphalt manufacturing,* and

supporting facilities.
Third
in
importance
Ras

*An address

Annual

Mr.

Exchange

be summarized

Conservative majority was much
smaller than it was anticipated by most Con¬

dle

problems connected
industry in the Mid¬

the oil

East

of secondary

are

importance to those of

the

world

talk

the

political leaders in the Middle and

servatives and their sympathizers.
this

a^plitical,

social, and economic nature. In
fact, it was in recognition of this
that early this year I traveled
around

follows:

The

(1)

because, while these are

formidable, they

now

simism

Etnzig

to unwarranted pes¬
stability of the new

way

gave

regard to the

government.

that

feared

As a result
unwarranted

their

disappointment

optimism
Paul

Dr.

over-all

majority that is only slightly larger than was that of the Labor
Government in the last Parliament would not be sufficient to

Far East. We heard at first hand

enable

problem
that
exists
in
Lebanon,
Syria,
Trans-Jordan,
and
Egypt;
also
about the growth of nationalism
in Iran, Pakistan, India, and the
countries of Southeast Asia; about
the problems these governments
are
facing in trying to improve
the standards of living of their
people and assume positions of
equality in the community of na¬
tions. Almost without exception
we
found
that the
responsible
leaders realized that, even though

view

about

their

the

Arab refugee

countries, haye natural re¬
and;

sources

'abundance

labor, their economies cannot be
developed without the know-how
and capital that are only available
from

The

abroad.

constitutes

the

oil

industry

vehicle
whereby Western know-how and
industry are brought to many of
-

major

—

Churchill

Mr.

carry on

for

length of time.

any

for

months, and could have carried on much longer hadj
internal strife that forced Mr. Attlee to risk,

some

it not

for the

been

general

During

(2)

not

majority.

said

reason
years

the

most people were?;

some

extent

about it, and what
the

public

ing attention from economic difficulties.
Now that the election
is over and, at the time of writing, the position in Egypt appears

consolidating, the attention of the public is inclined to return
problems. Even the most enthusiastic supporters
of the new government have to realize that the change of gov-]
eminent does riot in itself diminish the gravity of the economic
to be

to the economic

difficulties.
the

worse

Although the economic situation has not changed for|
during the last week or two, more attention is now;]

Hence the wave of pessimism that;

being paid to. its bad aspects.

partly responsible for the unfavorable reaction
Exchange following the Conservative victory.
is

has

of the Stock ?,

the

crisis.

point.

Taking

The foreign government, on

the

one

view,

long

this should be

regarded as a bull

The Stock Exchange lives, however, for the present and'
There can be no doubt that the immediate
of the measures will be unfavorable to trade, and to the

the immediate future.
effect

-1

government;

yet disclosed its intentions, it is generally assumed that]
adopted in face of the threatening economic!

not

that acquire
those concessions have obligations

companies

to each other.

the

stern measures will be

that grant oil concessions and

private

ground that it was mere electioneering.
The sudden outburst of
the conflict over the -Suez Canal has also helped towards divert¬

governments

foreign

why Mr.]

in spite of?

gravity of the economic situation and pros-]

discounted

was

for

Relatively little was said

of Britain.

pects

electioneering campaign

the

inclined to for get the

was

be
on

appears to
be able to carry

There

election.
should

Churchill

the smallness of his

(3) Even though at the time of writing the new
Both

This

ignores the fact that, in spite of the smallness of its majority
after the election of 1950, the Socialist Government carried on,;

Mutual

Obligations Are

that provides capital, techni¬
skill, accumulated experence,

pany

Tanura

Arabia.

This

refinery
is

the

Saudi

comparatively
simple plant that does not include
a

cal

tract;

is entitled to

security of title and con¬
retention
of
managerial
.

control

the

and the
reasonable

company;

opportunity to make

profit.

value of government loans.
to

Some means will have to be devised

employment and to deflate the inflated pur¬

over-full

reduce

chasing power of consumers and producers alike.
Even though
some
of these measures will be directed against specific indus¬

producing luxuries and secondary necessities, there is bound
an
all-round tightening of credit.
This will necessarily
inflict difficulties and losses on business firms.
The object of

tries
to

inflation to an end, and this could not be
and reversing the trade boom that has
accompanied inflation almost uninterruptedly ever since 1945..
Higher interest rates that are expected to accompany the defla¬
tionary measures are expected to cause a fall in the price of bonds.
This effect was largely anticipated during the days that followed

the

is to bring

measures

without

done

checking

the

general election.
(4) There is a certain amount of uneasiness among business¬
men, investors and speculators about the prospects of increasing
industrial unrest resulting from the change of government.
It is
feared that the trade unions will not be so willing to restrain

because the workers will no longer suspect
side

the

remains
will

I would like at this

point to em¬
phasize that the profit resulting
from the development of Middle
East oil

is less than most

think. It

people

is true that the wells in

the Middle East have tremendous

productivity,
order of
well.

averaging

5,000 barrels

These

wells,

on '

per

the

day per

however,

are

costly to drill; most of the oil is
sour

there

and must be
are

stabilized; and

innumerable other costs

foreign

domestic

operations not found
operations. For ex¬

ample, in this country, when we
develop an oil field, we have ac¬
cess

demands as they were under a Socialist Government. There;
undoubtedly be less unofficial strikes and more official strikes,]
their unions to be on

wage
will

industry

supply

Continued

houses;

page

government rather than on their side.
But it
whether the number and extent of strikes

seen

can

little

doubt

about

the

Stock

Exchange.

justify the pessimism]

It seems, however, that the pessimism

No government will be able to reverse the trend
altogether, even if it should want to do so, during the

is exaggerated.
of

that, to some extent at

rate, the prospects of the near future

any

the

really increase materially.
There

Middle East Oil Is Not Cheap

changed

throughout

the world.

than any other oil-industry under¬

and

replaced

Stock

the

delivers

more
than 300,000
day of Arabian crude to

Churchill

Mr.

response

with

expect

and

the

was

was
anything but favorable.
There was a
sharp decline, especially in Government issues.
The reasons for this unexpected reaction may

ol do not propose to dwell upon

and markets abroad

barrels

Socialists

Attlee,

hand, is entitled to expect
of many nations to favor local re¬
adequate participation in the pro¬
fining by imposing discriminatory ceeds resulting from the develop¬
tariffs against finished products. ment of its.
oil; the training and
The
Abadan
refinery of the employment- of its nationals at
fair rates of compensation; petro¬
Anglo Iranian Oil Company, at
the head of the Persian Gulf, is leum products being made avail¬
the world's largest. Last spring it able at reasonable prices to meet
was
processing
545,000
barrels the country's domestic require¬
daily of crude into a full range ments; and that the company and
of> products, including 18,000 bar¬ its employees conduct themselves
rels a day of aviation gasoline. It in a manner consistent with the
is really a complete refinery that customs and the laws of the land.
includes fo u r 85,000-barrels-per
On the other, hand, the com¬

capacity,
five
plants, and isoIn
1946
the
owners
of
the merization and alkylation instal¬
Arabian American Oil Company lations. In fact, this refinery alone
decided to proceed with the con¬ has been supplying 20% of the
struction
of
the
Trans-Arabian product requirements of the entire
Eastern Hemisphere. It is no won¬
Pipe Line which soon came to be

and

to supply

though later
speculators and

the operating

polymerization

This line, to¬
gether with the portion owned by
Aramco, is 1,068 miles in length

relapse,

sulphur-dioxide

Tapline.

total of 435,000 barrels a day of
Iraq crude to the Mediterranean.

followed by a
wishful
thinkers
among
dealers bid up the
prices gradually as Polling Day was approach¬
ing. Although the Conservatives defeated the

provoked by that decision

Problems Related to Middle

barrels

known

new

dissolution of Parliament. The one-day boom.

sequently enlarged, but still only
runs about 10,000 barrels a day.

completion of this line will bring
a

proposed by

measures

LONDON, Eng.—It was widely expected that a Conservative?
victory at the general election would be followed by a spectacular
boom oh the Stock Exchange. There was, in fact, a foretaste of it*
following on the announcement of Mr. Attlee s decision to ask for >

requirements. This was sub¬

Local

these countries.

area

because

has

crude

this

This

elsewhere.

Tripoli

the

(3) stern

Conservative
Government, and (4) prospects of rising industrial unrest.
Concludes, however, Stock Exchange slump may be temporary.

three great

are

from

operation ofintermittent

London stock market following
ascribes this to (1) small Conserva(2) realization of Britain's serious economic
decline in

refinery was

small

Lebanon during

refineries in the Middle East, the
bulk

ing amounts, however, are being refined
brought by pipe line to the East¬ plained
Mediterranean.

constructed

the

Mediterranean

1948.

also

about

importance

the

since

East. You have all heard for years

the

countries,

majority;

problem;

that reached

this refinery has been

be continued.

rently

ern

was

war

difficulties between Israel and the

created by stoppage of Iran's oil, but doubts supply
can

has

last

throughput of about 80,000 bar¬
a
day. Due to. the political

dicts settlement of Iran's oil controversy.

are

the

rels

filled gap

tive

crude. At
built just

East

refinery

before

market, since natural market is Europe, Africa and Asia. Says
Russia has insufficient tankers to take out Iran's oil, and pre¬

Middle

process

Haifa

and domestic pro¬
fear this product will flood American

concludes oil from that

Commenting

have been
the Mediterranean to

Prospects

British election, Dr. Einzig

the Persian Gulf, plants

Oil Co. of California

Thursday, November 15, 1951

By PAUL EINZIG

refineries

to the

...

British After-Election

substantial quantities

with

forces

Chronicle

trade

period of rearmament. There is bound to be a certain amount of
inflation under any government, and the change in Britain may
only

mean

difference

of degree.

long as inflation con¬

tinues, even at a reduced scale, trade is bound to remain reason¬
ably prosperous.
There will be less governmental measures
against capital and enterprise, which fact should go a long way
towards generating optimism towards industrial equities. As for
the prospects of government bonds, the Conservative government
is doubtless aware of the need for maintaining them at a reason¬
ably high level, and for this reason the weapon
rates will have to be used in moderation.
As and when the beneficial effects

of higher interest

of the stern measures will

begin to make themselves felt, this is bound to generate optimism
towards the future.
For this reason the post-election slump on
the Stock Exchange is

likely to prove to

be temporary.

Volume 174

Number 5064

The Commercial and Financial

Chronicle

(1857)

•

erica

11;

I..

it
•!

"i V

K v

It's holding tip

nfosfy un
strain

vuiP;
rjH

•:

Vill.

»U

f'.!

•

/
-

yCl!

§
A\ /m

Jys

jy-

*9'
k

1 Wv

lit

W'MfU

j'; i;

•>;.i

'.-niili

•

ft': *V,J5(
,

<■'%

-I

'
,'j'i y

S*%j^

You know how
Oil refineries

important

your

heart is to

Petroleum has grown to he the third largest of all America's
terms of total investment. And on
petroleum's

you.

industries in

important to tin; factories and
mills and mines of America.
If they stopped "pumping"
fuel, America's complex industrial machine would stand cold
and useless. I f
they stopped "pumping" lubricants, it would
quickly grind to a stop.
just

are

ability to
This

industry are attending the annual
American Petroleum Institute. Their job
petroleum will

Right

now, American industry is placing a severe strain
its "heart." Industry is
growing at the rate of 25 billion
dollars' worth of new plants ami new equipment a year. Its

lubricants—already

But the "heart"

can

as^strong as it was five years

everyday.

great—will be

take it.

It is almost

doing its part. An ever-increasing quantity of
top-quality industrial lubricants is now coining from Pure's
great new lubricants plant near Beaumont, Texas, one of the
units of which is
pictured above.

third again

Thanks

ago—and it is getting stronger

•

grow

convention of the
is to see to it that
and that all future needs will be met.

Pure Oil is

even greater.
one

hinges the future growth of all industry.

leum

need for

grow

week, in Chicago, leaders from all phases of the petro¬

able

serve

this increased
twice

many

'■

sure
1

with Pure

"!*.»

Industrial Lubricants
Extreme

Engine and machine oils
Machine shop

pressure

Protective

lubricants

Mining

./...vo'i *

greases
1

Diesel and gas engine oils

Multi-purpose

* v*.

'■>

Pressure and gun greases

Compounded cylinder oils

O •••

processing oils

r."

l.
.

greases

i-qo

•.

.{o
-

.srs.

oil-.;

*v,

furB

I iio

nr.

"irdvhih

•1

lit or."

■'■it

101 >

Or";

';1 :•£-

Textile lubricants

bt'v

■

coatings

Circulating oils
Textile and

biJ'

•

t_:

1":

production, Pure will soon be
industrial users as in the past.

~j.

'•' i

■

hi..
C

•

vi.- .-v

ij i
'

b:
•itOl!

v.''.

v.'. -

•

•.

;

■' 5

•

The Commercial and Financial Chronicle

(1858)

••

•••

•

15, 1951

Thursday, November

...

tropical wealth, neither does nor

But

Canadian Securities

"I find it

baloo

Nat¬

ural Gas Conservation Board

will

resume" its hearings
six applications for

again

once

this week

permission to export natural gas
province. Following sev¬
eral postponements it is now ex¬
pected that definite action will be
forthcoming that will herald a
new era of dynamic development
■of the
Dominion's hitherto ne¬
from the

glected natural gas industry. With
the consummation of the present

now

cubic

trillion

last 20 years natural
gas has become one of the leading
growth industries.
The tremen¬

dous

the

demand

consumer

"It is

appears

ment

rangements for export south of

material

the

list.-

possible to pro¬
commercially gasoline, fuel

from

gary and Edmonton it was not
until the great oil discoveries in

near

the tremendous pos¬

that

Alberta

available commodity.
Thus

is probable

the

future

will occupy

that in the

development

natural

Canada's

There

the attention of U. S.

and

given
serious
attention.
Until
quite recently also most Canadian
oil interests have been inclined

greater extent than the search for
new sources of oil.
Ultimately the
utilization of natural gas as an al¬

to subordinate the search for new

ternative

of natural gas to the de¬

sources

evident

coming

It is now be¬

of oil.

velopment

that

natural gas
than oil for

interests

cited.

superior form of
result in considerable

and.

will

fuel

oil

exploitation.J

over

In the first place the

conservation

that
as

effectively marketed;
the volume of new production
can

mounts the
ketable

for

proportion of the mar¬
is progressively

product

Furthermore the market

reduced.

oil

Canadian

limited

result of the competition of
lished

ply.
gas

U. S.

sources

estab¬

of cheap sup¬

The production of natural
on the other hand is not sub¬

ject to handicaps of this kind. At
the moment in fact a premium is
the

discovery

placed

sources

of supply of natural gas as

are

many

where and

beginning
Board
serves

was

estimated

the

Conservation

that proven re¬
in the neighborhood

were

people of this country

Corporation

Continued

from first

strain

The

natural

rapidly

gas

and

mother country,

the

deliver,

over¬

the incentive for
producers of basic commodi¬
ties to benefit from the seller's
Thus,

tive, the
There

was

also

of; recorded

internals

but

these

well absorbed and had little

were

finally

the

Canadian

touched

dollar

recent

high point of 41/8%.

stock

markets

erate return
that
a

liquidation

some

there

was

of bullish

On the
a

mod¬

sentiment

again was mostly expressed
good demand for Western oils.

The

industrials

and

base-metals

also shared in the recovery move¬
ment but the gold issues failed to

out

reached

notable

headway.

of $9,000 million has not
yet the half-way mark.

Foreign nations stockpile too, or
promote
private 'inventory
ac¬
cumulation'

such

relaxing

import licenses (Brazil).

CANADIAN

SECURITIES

—with

being

are

all

also

precedented tempo,
for

the

efficient

methods

utilization

costly materials, and for their
complete gathering.

.;r

Given this tremendous potential

growth: why should the

than

quickly passing phase? The

answer

ticular

factors

that

general
at

are

and

par¬

work

in¬

and

postponing the nat¬
ural process of self-adjustment in
the raw material economy of the
The
sence.

time
It

element
a

long

of the

way

es¬

from dis¬

of their

and

itself

factor, for the time being,
to the mounting

that

contributes

costs and the upward

New York 5, IN. Y.
Established

1922

ny 1-1045

when scarcities compel the
to

cators

Kippen & Company, Inc.

sulphur

quantities.
tween

The

in
time

prospecting

impede the expansion of planta¬
tion, mine, and partly even farm
production. Patently, products de¬
pending
on
Soviet
controlled
tungsten,

—

610 St, James St., W., Montreal, P. Q.

months

still

threats

burden

the

over

fact

lands.

loss

is that

other

year,:},

Telephone Lancaster 5101

amounts

Direct Private Wire to Toronto

colonial
tial

areas

where

"ingredients," including trans¬

gloss

oil;

the

from

substitution

the

unprecedented seller's market,

raw

export

materials

ran

victim

major

25%

be¬

largely be¬
supply is a

Kashmir

the

conflict

Hindustan and Pakistan.

insecurity reduces

and

output

lesser

and

need not

some

low the pre-war level,
cause of riotings. Jute

Malaya

essen¬

Iranian

its replacement

Indonesia's

actual

all

"under¬

may

expensive petroleum for the
cheaper provenience. In 1950, in

the

remote

controlling prices and manipulat¬

tin

even

the

provides; further
The artificial

prices is perhaps the most pa¬
chapter of our "inflation-

uct

thetic

control," with world-wide reper¬
cussions.
The point is that even
the range of

most

which

world's

greatest

commodities, and

significant ones at that, in
production-incentives real¬

ly work, inflation is being engen¬

Presently, the Department

dered.

of Agriculture incites
to hold back

the farmers

grains and cotton by

promising better "parities"—and a
"sure bet" to the bulls in the Chi¬

pit.

cago

Internationl

"co-operation" was
in 1950—when a
slump was deemed imminent—to
reorganize the British-Dutch gov¬
revived

early

ernmental cartels of 1930's and to
hold

commodity prices by setting

floors, laying aside buffer-stocks,
etc.

Then

came

British

the

vanished.

the

But

committees
in

countries

urg¬

set

up;

debated

for

were

months

row,

controls

American

their

boom and

new

interest

Conferences

ing,

quotas,

production

distributing

the producing

(outside the U.

S.)

re¬

price regulation or
allocation plan that might reduce

sisting

every

their freedom—to

"gouge."

How¬

of resolutions were
advising the members

tons

ever,

produced

how to economize with commodi¬

Indo-China

be mentioned. The

the

boosting of Amer¬

(and Canadian) -farm prod¬

ican

ties.

Philippines,

the

storehouse' of

the

end,

the

representatives agreed
the

and

samples of bu¬

reaucratic meddling.

also

turmoil in the vast region between

Egypt

driving

copper,

into soft-currency markets,

exports

extent

Siam.

Chilean

and

them

Burma,

fields, American or Arabian,

be¬

war-like situations

important

very

developed"

stretch

longer,

antimony,

seriously affected
by the slowly tightening EastWest blockade. Domestic conflicts,

manganese—are

Members Investment Dealers Ass'n of Canada

producing

quality in the final product.
Political obstacles, in the broad¬
est sense of the adjective, further

commercial

and

substitutes

such

use

so,

fabri¬

available, often at the cost of

are

Revolutionary

cious

tendency of

Especially

prices.

commodity

between

marketing the pre¬

auxiliaries is

cilities

covering iron sulphide deposits in
to

ex¬

Nay,

Minnesota

Inquiries Invited

show

the unprecedented
expansion of basic production fa¬

war

nothing

change.

sources

that, substitutes
developed in an un¬

top

to confuse the markets

powers

high for ydars if the demand ing the tariff, by mismanaging
the system of priorities and of
(as it is likely to).
bulk buying.
Controls are a ma¬
any case, the opening up of
new
sources
of supply
(and of jor factor in creating shortages
synthetics) takes not only time and scare buying. One day, the
but also expenses. During the in¬ scrap markets are unsettled; next,
cumbency, it means a drain on fi¬ price ceilings on imported lead
nancial, human and physical re¬ make that rare metal rarer. In¬
sources—-also on raw materials! judicious haggling about Bolivian

authorities are
stockpiling limb; present¬

program

promoting with the. right hand the
growth of production, our own
authorities inhibit it with the left

Defense

is
a
huge $1,400 million or so, with
more
to come.
Our stockpiling

abroad

judgment. While

in search of poor

holds up

ly, the available appropriation

any

Controls

Confounded

One does not have to go

Very

can

INCORPORATED

and buy industrial

cannot

charges.

example,
and there is no
equivalent quality to substitute
for merino. Its price
must stay

Western World.

Mass.

their

surrender

must

the

ing

costl.y process involved in the de¬ and purchasing contracts alone,
velopment of iron-ore, and other $500 million are in the process of
mineral deposits, the exploitation disbursement to promote stagger¬

MINING

Boston 9,

further impedi¬

material producing

raw

from

goods

the

set-up

monetary

Sterling Area is
ment. The

that wields more or less arbitrary

WESTERN OILS

Fifty Congress Street

basic commodities.

Raw Materials Prices

hibiting

4-2400

ing of farmers—are being pro¬
supply, lends itself admirably tected by tariffs, courted by sub¬
as
a
natural outlet for Canadian sidies, bathed in cheap credit fa¬
gas.
Unlike the protracted and cilities, etc. In governmental loans

INDUSTRIAL

WORTH

sponsored
and fi¬
—
puts additional
the supply of the same

officially

nanced

page

disequilibrium be anything

Two Wall Street

the

stops

growth of raw material capacity
in quite a few backward and even
"forward" countries, while their
forced industrialization—much of

which

of output

A. E. Ames & Co.

investors

foreign

dollar proceeds

make

CANADIAN STOCKS

ill-treatment

The

market.

world

members

and remoteness from U. S. sources

Municipal

Ar¬

regime,

market is reduced.

which

Provincial

well. Under a

plans for export long-term contracts to purchase portation, may be lacking. Also,
and the output in large volumes and new substitutes are very slow in
Seattle and Spokane areas natural at guaranteed prices.
That dollar effectively materializing, fast as
are
forthcoming at Jew the laboratory processes may be.
gas will make a valuable con¬ credits
tribution to Canada's foreign ex¬ interest, goes without saying; the Time-lag is the prime adjustment
hurdle even in a number of fields
change reserves. In particular the Export-Import Bank,, the World
in which no problem of new tech¬
U. S. Pacific North West in view "Bank, and Oven the ECA, help.'
Domestic miners—to say noth¬ nology arises. Wool is an outstand¬
of its lack of local fuel resources

new

Government

non-

gentina, traditionally a first-rate
exporter of wheat, cattle, linseed,
hides, etc., is fading out of the

Minneapolis-St. Paul,

the

effect'!

CANADIAN BONDS

re¬

productivity

nations

colonial

in the event of the consum¬

at the

hearings

the

national-bolshevist

everywhere it is needed.

Whereas it

interference

Government
duces

others whose views might be

be effected ing increase in the output of
remarkably low "critical" minerals: tungsten, anti¬
result of the insistence of the
zinc, manganese, molyb¬
cost. It will not be long therefore mony,
Alberta government that the ex¬
copper,
asbestos, mica,
before this new
and important denum,
istence of adequate reserves must
•Canadian industry
will exert a nickel, platinum, sulphur, chrome,
be proven before sanction is given
Stepping up titan¬
notable influence in Canadian eco¬ and so forth.
for the export of gas.
ium, aluminum and steel capacity
nomic affairs.
Fortunately the Dominion ap¬
is fostered by every means, partly
During the week the external
even
pears to be almost as well en¬
by threats that the govern¬
dowed as this country with this section of the bond market con¬ ment itself might go into the busi¬
unique asset that is playing an in¬ tinued on the heavy side1 with of¬ ness.
At home and abroad, and this
creasingly important role in .the ferings of Canadian Nationals and
economies of both c o u n t r i e s.
provides a most significant incen¬
the new Ontarios still in evidence.
new

as an

English student observed astutely.

mation of present

policy of the Alberta government
sets a limit to the amount of oil

privileged,"

struction of the

However, the main thing is to clean up any¬

savings of U. S. dollars that are
now expended for fuels imported
from south of the border.
More¬

affords greater scope
immediate profitable

confident that the

the

both

override

apathy of the masses and the ob¬

resources

gas

sibilities of this natural fuel were

Canadian

enough

businessmen

were no

going to demand and that they will get a return
to a high level of integrity and of morality in public
life. But let us not forget that it takes two to make
a deal and let us condemn just as readily the busi¬
ness or professional men who are on the other end
of the corrupting deals."—Wm. H. Ruffin, President
of N. A. M. (Oct. 19, 1951).

oil, and other petroleum products
this versatile and readily

Although natural gas has been
utilized for many years by west¬
ern
Canadian cities such as Cal¬

If there

are

also

izers ,•
duce

it is to sell it.

set of motivations, and
of compulsions, strong

system

Hulcy, President of the Chamber of Commerce
of the United States (Oct. 19, 1951).

which is its employ¬
raw

provide

C. A.

the production of plastics, detergents,
add paints, alcohols, resins and fertil¬

will
S. dollar
earning asset to its already long

the Dominion
another
important U.
border,

poses,

nent among

7, 1951).

public officer who succumbs to bribery, and I hold
no
brief for businessmen who do the bribing."—

natural gas has innumer¬
able other Industrial uses promi¬

but in the event of satisfactory ar¬

countries) is precisely that it does

culpable to buy Government influ¬

nationalist movements (in those

willing to hand out home freezers, mink coats and
costly vacations, there would be fewer public offi¬
cials ready to take them.
I hold no brief for any

industrial fuel pur¬

domestic and

just

ence as

only by the

plans not only will a new cheap
fuel be available for the great in¬
dustrial areas of Eastern Canada,

why

dentally, "One of the reasons

totalitarianism offers an attraction

Commission (Nov.

avail¬
ability of steel pipe, and the total
mileage of the existing pipeline
systems is now in excess of 300,000.
Apart from the demand for
limited

outraged indignation

unethical conduct under discussion."
—Robert Ramspeck, Chairman of the Civil Service

In this country

trillions.

during

may

business in any

believed to amount to no less

than

interpreted to
show that the majority of man¬
kind is not ripe for any other but
a colonial status to keep it work¬
ing
rather than
boiling. Inci¬
Which

passing strange that, with all the hulla¬
misbehavior of a handful of public

there has been

share.

promises to do its vital

expressed by business regarding the role played by

they; are

feet

about

servants,

By WILLIAM J. McKAY
The Alberta Petroleum and

other industrial nations share

our

and

American
letting

supplies of sulphur, copper

zinc,

domestic

thereby enhancing the
scarcity.

The net result

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1859)
in terms of

relieving the commod¬
ity price inflation is nil, of course.

ceptions, their current output is
or approaching all-time highs.

There

Monopolies

Some

that

international

"co-opera¬

cient

every

reason

soon

to assume

will

suffi¬

Anglo-American official circles
the

—put

into motion. Since last February, a
letdown in stockpiling (tin, zinc),

Even
other

policy based

require¬

plus

.minor

holds

presum¬

slowed

liquidations,

has

tion" does flourish: between
Spain
and Italy, for
example. Between

ably for rubber, natural and synr

even

reversed

them, they practically control the

thetic

large

number *of * commodities

world's mercury output and make
ruthless
use
of
this
monopoly,

wood)

holding
used

price

mercury

1,000%

be.

than

with

same

orice

ing.)

The

Cuba

with

stopped

buy¬

connives

with

"stabilizing"

and

sugar;

Mexico in silver.

Individual

countries also try their best in

ex¬

ploiting the sellers' market.
Here

and

em¬

ployment and government protec¬
tion

union

generated

malfaisance

monoply

combined, for lumber (ply¬
and

quite

few

others.

outlook for these

and many

■

Excessive

the

prime

precedented

swings
Their

deficient inventor¬

cause

speculative
the last
15

frenzied

the

un¬

price
months.

accumulation

heels of Korea—reversing the

then

call

down

dominating

depression-fear

for

partly

arrested,

them.

Briefly,

the

foreseeable

—

second

terials

category of
position.

raw

Wool

months

period

supplies

the

replace

comprises

will

tion of the

and

them.

the consequent threat to the
level

prices

the

actual

over-

Thomas Morris
Thomas

Morris, member of the

New York Curb

not

see

awhy

Exchange, passed

Nov. 6.

repeti¬

it.
count

may.

unforeseeable)
of

process

Rise

they

rising

must

James

other

staple

again

Henlry Gundy

James Henry Gundy, Chairman

(barring
of

the

board

Wood, Gundy &

Co., Ltd., Toronto, passed

—

the age of 71.

have

the labor

markets that results in

ever-higher
costs, especially also in

unit wage

mining.

Moreover, it permits
indulgence in wasteful
strikes, contributing time and
again to the tightening of supplies
(copper).
la bo

r's

The

total

sum

cumstances
adds up

of historical

and

national

cir¬

policies

to the conclusion that

commodity price 'relief could be
expected by an early expansion
on a
large scale of the sources of
.

supply, excepting a few lines (oil,
sulphur, cocoa, etc.).
The

demand

material
for

the

raw

equation has been taken

granted

better

side

the

remain

difference

foregoing.

"granted."

between

The

plus

and

ihinuS in that equation

may

matter of less than 10%

change.

Can

count

continued

boom in the consumption of b&sic
industrial ingredients? Or on per¬

petual

floors,

under

global scale,

their prices, notwithstand¬

ing the

spectacular

technological

progress that tends to lower costs?
This boom rests in the first
on

preparations

war

place

which

are

almost certain to peter out by the
middle of this
decade, if not much

earlier.

Already,

the

conviction

that Russia has "missed the boat"
and

could

not

attack

the

thesis

which

has

been

"news"

—

for

writer
a

year

some

fresh

spreading.

to cause

seems

more—

this

hammering

longer

any

(The

thinking in the Pentagon, and in
Europe, but not as yet in the
State
Department.)
Sooner
or
later, it may become extremely
difficult

keep the restless Eu¬

ropeans on the armament

the

job, and
public might grow

American

tired

also. If so, we may or may
face a real recession, but the
materials most certainly will

not
raw

be in for "trouble."
But
not

the

longer

topic.
future, the

bullish,
mand

outlook

present

our

immediate
months

;

run

so,

prospects should be

indeed,

for

the

For

even

the

goods

consumer

de¬

One Telephone

Exchange

proper

should not

rise, which is unlikely.
determining factor still is the

The

extraordinary
level
of
current:
output as well as of new con¬

Five hundred
ment

work

struction in the so-called Defensesector

the

is headed for

1952.

Japan
r

due

are

industrial
for

increase

Given
which

sec¬

records

the

producers;

the

"stuff"

accordingly.
limitations

further

is
-

under

expansion

supply

labors—given the general
inflationary drift and psychology
predict that

—it should be safe to
crude

material

likely to
How
us

much

this

another

leading

group

prices

crucial

set-up.

non-ferrous

the

most

are

upward.

higher? That brings

unstable

haps

than

move

most

aspect

Take

metals,

significant

of
the

ternational

and

trade.

fuels,

With

equip¬

needed

install

just
10,000-line Dial Telephone
are

Exchange.

Eighty miles ofcable are needed
to

connect

There

are

all

this

apparatus.

2,600,000 soldered

nections, each

one a

con¬

careful hand

operation.

Here's the story

us,

All that is for only one Tele¬
phone Exchange to serve one
community. At present-day

get

prices, the cost runs to $1,500,000.

of months of

work condensed into

two

minutes

reading time. (Bear with
please, if several of the words
technical.)
There

The money
are

1800

crossbar

switches, 4000 multi-contact

re¬

lays and 65,000 conventional
relays. These automatic switch¬
ing

mechanisms

millions

open

telephone circuit

ities

vestors

their

who

are

in¬

some

ex¬

BELL

facil¬

willing to put

Only through reasonable earn¬
can the telephone company

ings

attract

the
to

new

do the

money

job.

per¬

new

largely from in¬

savings in the business.

needed

paths.

for these

must come

single

of primary products, other
foodstuffs

tons

62,000 man-hours of

Germany andthe home-bound as

demand
to

new

one

addition,

large-scale
their

American

In both ways, that

economy.

tor

North

and

high
primary

level.

mistakes made in the

prices.

staples, including scrap, to

foreign and
subjected to

thoroughgoing revision. But it is
well to bear in mind the
synthetic
of most shortages and

taken place.

preceding

orderly

genuinely

our

are

category k comprises

commodities

words,

scarce

Correc¬

It may be assumed that the next

ma¬

tight

until

character

climbing

occurred.

and

stockpiling

part, artificially.

inventory' policies.

merely

unless

military policies

<•

reason

expectations

war

fantastically
have

The1 third

inventories, for example, are
virtually liquidated, and added

group

tions already have
the

sisal

This

inept

might supply, like sugar and coffee; their
depend¬ prices are held up, for the most

reappear,

is characterized

statistical"*

such

was

which

bottlenecks

disappear and

•

there

so,

than

prices

the
"inventory-sensi¬
group—is subject to specu¬

lative

them

tive"

ing largely

ies private and governmental, are

the

elsewhere, "full

same

other staples.

wolfram
.

boomeranged:

The

Evidently,
inventories^ are the
marginal factor that controls the

above what it

(But Spain's attempt

the

ments.

for

scarce

period.

actual

satisfy

stay

skyrocketing of prices

TELEPHONE

SYSTEM

that is

away

The Commercial and

1951

Thursday, November 15,

Financial Chronicle...

(1860)

show it, your prospects and
will know it first. But

you

customers

Over-the-Counfer Industry
By DAVID

successful

constructive.

who
out

circumscribed in ability to,
adequate profits through fear and other circumstances.
Says solution of dealers' plight probably lies in an increase in
the presently "ridiculously low" sales margins. Urges greater
publicity of quotations and increased financial information by
corporations as means to increase investor interest in overhave been

that dealers

business is
their "atti¬

fundamentally that
tude" is both positive and

Pointing out that much of the over-the-counter securities busi¬
ness
is conducted at some risk and little gain, Mr. Morris
asserts

closing

who

earn

have

soundly
men

seen

the one'desire to go
and sell as much as possible
have

fairly well for a while.

They make up in enthusiasm and
energy what they lack in perspec¬
tive and understanding.
Finally

little thinking

talk

he'll

some

are

you

going to ask for an appointment
during the next few weeks, hold
too much in stocks?
Others may

lot more who

will.

Fedders-Quigan Stock

possible that some people should
be shocked out of their compla¬

Underwritten

Offer

Isn't

overpriced .stocks.

hold

you.

possible

isn't it
people whom

subject,

this

that

of your own

know it.
If he

his health, he'll

And

DUTTON

doesn't, there are a

York City
' ;
York Security Dealers Association

President of New

most

By JOHN

MORRIS*

David Morris & Co., New

;

welfare is the
important thing in

financial

Securities Salesman's Corner

Inadequate!

Profit Margins Are

another man's
second,
his life

believe that

if you

Fedders-Quigan Corp. is offer¬

ing

Stockholders of

common

record Nov. 9 the right to sub¬
Haven't we been on a
scribe to 62,041 shares of 5% cu¬
they exhaust their lush prospects. twenty-five month bull market
mulative preferred stock, series A
They tire out, and like the pro¬ spree? Are not commodity prices
dropping, retail sales slipping, and ($50 par value), on the basis of
verbial
sky
rocket they fizzle
one
preferred share for each 20
away.
In the retail
securities isn't this a time for caution and
shares of common stock held. The
for sound investment programs?

the-counter securities.

cency?

business it is essential that a pro¬

preferred stock is priced at $50
you believe that you are in a
profession where your mission is per share. The rights will be evi¬
denced by subscription warrants
to adjust the investment accounts
expiring?at 3:00 p.m. (EST) on
blood pressure up over a glamour of your clients, so that they will
Nov. 23, 1951.
The offer to stock¬
stock, can go out with a pocket have a balanced program between holders includes an oversubscrip¬
full of inquiries in a bull market the various types and classes of
tion privilege under which pre¬
that over a
and sell it. It is primarily an ap¬ securities in order
ferred
stock
not subscribed for
tively to uphold our reputation, peal to the profit incentive that period of .: years they will have
through the exercise of rights may
and to do everything in our power motivates most buyers under such protection
instead of losses,
be acquired by warrant holders at
to eliminate all malpractice that circumstances.
haven't you got something to sell
the regular subscription price. ...
that is important? If you believe
might endanger our standing.
The offering has been under¬
How Attitude Helps Make
this, isn't it possible for you to
written by Allen & Co. which has
Deplores Investor Apathy Toward
Telephone Appointments
say, "Mr. Jones, I am not calling
Over-the-Countcr Securities
agreed to purchase from the com¬
Some men have difficulty in upon you to try to sell you a
pany
any
preferred shares not
As president of this association
making telephone appointments^ thing. But I have some informa¬ subscribed for by warrant holders.
I feel it is my duty to express the when they work over a list of tion for you that you will find
Net proceeds from the sale of
concern, which I know is held by unqualified leads.
In most cases valuable. If you will grant me the
preferred stock will be used
many,
regarding the constantly they are drawn off into discus¬ five minutes I promise you that
by Fedders-Quigan Corp. to. retire
diminishing interest shown by in¬ sions about securities, or some I will not stay longer unless you
$2,000,000 outstanding short-term
vestors in fresh commitments in other extraneous topic, and they wish it. May I see you at 10 this
bank loans and for general corpo¬
over-the-counter securities.
I do allow the customer to gain the morning or would 2:30 in the
rate purposes, including the fur¬
not have in mind bank and insur¬ upper hand, which of course leads afternoon suit you better?"
nishing of additional working cap¬
ance
company stocks nor mutual to a refusal of an appointment.
If you believe that it is impor¬ ital
to
accommodate
increased
funds, but rather the issues of the The basic cause of indecision over! tant for people to put their finan¬
production.
small and large industrial corpo¬ the telephone, in interviews, or at cial house in
order, you are going
The preferred stock is convert¬
rations that are not dealt in on any other time, is fundamentally to see
people. You will use any ible on or prior to Nov. 1, 1961,
any exchanges; the stocks that are a question of disbelief upon the and all dignified methods of set¬
into common stock at the price of
held by a vast number of share part of the one who is making the
ting up your interviews. In such $13.75 per share of common stock.
owners throughout the nation.
proposal. Unless a salesman be¬ cases as the foregoing, where you > A
sinking fund is provided for
Investors are insisting more and lieves that he has something of call for five
minutes, then stick the preferred stock under which,
VITAL importance to discuss, and to five minutes. Use this time to
more, and rightfully so, upon the
commencing on June 1, 1953, the
availability of quotations, and of that it will be of (Jefinite help project your personality, make company is required to retire an¬
balance sheet and earnings data. to his prospect, whether or not the
aquaintance of your prospect, nually preferred stock with an
•This condition, which was dis¬ immediate business is the result and sell the importance of a fu¬
aggregate par value equal to 20%
cussed at the last general meeting of the interview, a high percent¬ ture interview which will be de¬
of the consolidated net income of
Of our membership held in Sep¬ age of turndowns will naturally voted to a real discussion of the the
company and its subsidiaries
Stop and think this prospect's entire investment pro¬ for the preceding calendar year in
tember, has been recognized by take place.

Our industry could
behind us its business.
another
year
of hard work in not have prospered without hon¬
which
we
experienced
strong esty of purposes and high ideals,
competition and limited rewards. if we are to continue to be held
in high esteem, it is the responsi¬
We have seen
bility
of
all
in
the security
large issues of
industry individually and collec¬
securities sold

Tonight

have

small

for

profits.

And

have

transa cted

much

our

business

risk and

some

little

gain.

Dealers in the

over-thecounter indus¬

try have been
circumscribed
in

abil¬

their

ity

Morris

David

earn

adequate

profits through fear and other cir¬

beyond their control.

cumstances
As

security for

result, many of us are grow¬
ing old, ail too quickly, in pursuit
majority of
to

aside sufficient

set

provide for
have

our old age. The
have not been able

surplus to

future security as

our

people in other industries. It

will probably mean an increase
sales

margins

for

in
securities

our

which remain

ridiculously low in
comparison with sales margins on
other products.
The glamor of
Wall

has

Street

dimmed

clamor

not

somewhat

been

the

and

young

today

enter

men

our

industry which has been living on
the heritage of reserves accumu¬
lated in the past.

confused

times

expect to be the exponents, of free

enterprise,

taking

advantage

tendencies

obtain

immediate gains at the expense of

heritage of freedom.

our

sad

city

commentary to

Meridian,
the

come

We think
see

Mississippi,

financial

district

obtain monies with which to erect

buildings to

rent to

whose securities

corporations
listed

are

the

New York Stock Exchange. While,
these

corporations achieve-

saving, it is
at

the

tax

short-term benefit

expense

injury to

free enterprise economy.

our

Do these

similar devices presage a so¬
cialistic scheme which in time can

and

tear

down

hooves

before

our

industry?
to

all

think

embrace

new

We must maintain our

character
what
and

our

make

and

be¬

schemes.

certain

that

do will benefit ourselves

nation in the long run.

character

distribution of new
securities by small- and medium-

something
diate

study

must

that ^requires imme¬
and correction.
It

not

••

nation¬

our

morals, as evi¬
by the front-page head¬
will react to the harm of

industry generally, if the leaders
high in government and industry

government to do the job
This association is

us.

condition which

this

certain

suggestions to

that

we,

their

utmost

Wall

enjoyed

Street

adherence

?•<

public..

•Remarks
Dinner

Mr.

the

Morris
New

York

New

Association,
Waldorf
York City, Nov. 9, 1951.

26th

An¬

SecurityAstoria,

haven't

interested
touched

the

that

spot

you

where

Don't

gram.
of

the

control

lose

ever

interview.

know

excess

salesmen who refuse to
talk business with clients standing

rated

hall, at a desk, in a crowded
office, at the club, or anywhere
else except in their own quiet
office, or the prospect's home or
salesman. He isn't interested in his office.
They want attention
anything outside of what he may and they place their business on
be doing when you ring the bell a
pedestal of respect. After all,
on his telephone,
even if that is if you weaken one little inch, if
sitting back in his chair and day¬ you importune, if you lower your¬
dreaming.
1
' 4
self in the slightest, either by the
For this reason you have to tone of
your voice, the look in
shock him a bit, stir him up, get
your eye, or the words that come
his reactions going along the right out of
your mouth, you are licked.
lines. Sometimes you can do this The other fellow
places emphasis
by taking the tack that you have where
you direct it. If you are a

other

his interest lies.
ed

He isn't interest¬

spending money, or in de¬
nying himself the pleasure of loaf¬
ing instead of warding off the
importunations of some over avid

information

for him that

curity
in

will be

helpful if he gets it, and harmful
if he doesn't. If you would like to

peddler
you

are

you'll

know

hungry for

first.

order and

$1,500,000.

Fedders-Quigan Corp., incorpo¬

se¬

transfer and

of heat

metal

miscellaneous

ucts in

in the

is engaged

1913,

manufacture

four plants

prod¬

employing

ap¬

proximately 2,580 persons. Prin¬
cipal products of the company are
radiators and heater cores for the

automotive industry, unit room

air

conditioners, heat exchange com¬
ponents for the refrigeration in¬
dustry, space heating equipment

appliances, and metal frames
ladies' handbag industry.

and

for

the

The

also

company

contract

is a

air

unit

manufacturer

condi¬

tioners for Radio
America

Corporation of
(Victor Division), Avco

Manufacturing Corporation (Crosley Division) and others for sale
their

under

brand" names,

own

such

products differing somewhat
design from those manufac¬

for

tured
name.

sale

under

the Fedders
'

Sales

during the calendar year
were $33,607,050 and net in¬

1950

Notes

NSTA

$1,982,131. During the
months of 1951, sales
$25,526,419 and net
income to $1,147,381.

come

was

first

eight

amounted

Joins Waddell & Reed
SECURITY TRADERS ASSOCIATION OF NEW YORK
(Special

James W.

Day V.-P.
Of Aubrey Lanston Co.
has

Day

t: ■

Vice-

corporation.

Mr.

manager

Co.'s Chicago

of¬

formerly
&

James

elected

been

President of the

fice.

that

announced

Joins

Goodbody Co.

(Special to The Financial Chronicle)

Cater

Ga. —William

has become

Goodbody

Street, N. W.

Co.,

ing League standing
•

TEAM

of Nov. 8, 1951 are as

Points

Kumm

(Capt.), Ghegan, R. Montanye, Krassowich, Manson
Leone (Capt.), Tisch, O'Mara, Nieman, Braaley___
Goodman (Capt.), Weissman, Farrell, Valentine, Smith
Serlen (Capt.), Gold, Krumholz, Young, Gersten
Mewing Capt.), G. Montanye, M. Meyer, LaPato, Klein
Donadio (Capt..), Rappa, O'Connor, Whiting, Demaye
Hunter (Capt.), Craig, Fredericks, Weseman, Lytle
Bruian (Capt.), Siepser, Gronick, Growney, Kaiser___
Krisam (Capt.), Gavin, Gannon, Jacobs, Murphy
Bean (Capt.), Lax, H. Frankel, Werkmeister, RiedGreenberg (Capt.), Siegel, Cohen, Sullivan, Voccoli_-_..__

Forsyth

Floyd

200 Club.

Walter

Bradley

215

204

Five Point Club

None

Financial

Chronicle)

CITY, Mo.—Percy M.

associated

with

Reed, Inc., 1012 Balti¬

Avenue./

With King Merritt
(Special

The Financial Chronicle)

SPRINGFIELD,

Mo.

—

Charles

W. Wear is with King Merritt &

Co., Inc.

Two With Waddell & Reed
(Special

MT.

Jack-Manson

The

now

Waddell &
more

30V2
29
28
27
26 v'
24
23V2
23
20
19

KANSAS

Swenson, A- Frankel, Wechsler, King.

affiliated with

(STANY) Bowl¬
follows:

Security Traders Association of New York

H. Meyer..(,Capt.),

Aubrey G. Lanston & Co. Inc.,
Broad Street, New York City,

ATLANTA,
Dealers

not

NASD

coveted

high principles in the conduct of

business may protect our business
and
better
serve
the
investing

was

nual

the

in the over-the-counter

Devine

its

long

regarding quotations, and the en¬
listing of the aid and cooperation
of unlisted
companies, to make
financial statements, earnings and
other data available, to the end

Day

for

has

Therefore, it is the in¬
tention of this association to make
existed.

C. J.

reputation

of the

opinion that steps should be taken
by the over-the-counter dealers
through
the NASD to improve

the

them.

should

for

do not take proper recognition of

always

that

feel

wait for

have

eliminate

continue.

allowed to

not

publicity

and the need for
adequate financial information is

lines,

has

companies.

for greater

need

quotations

and

and do

In time

altogether

the

prevent,

denced

dangers

will

strength of

The deterioration of
al

carefully

he's

that

not

over—the only reason a man says

bring

will

investors.

retard,

This

changing politics, it is a paradox
to find firms^ which one would

socialistic

will

approach toward clients

precedence over sales enthu¬
siasm. Any man who can get his
take

As it

time.

markets

be harmful to
it

some

exist

inferior

about

Enterprise System
these

for

continues

sized industrial

Warns Against Sabotage of Free

most

fessional

The Financial

Chronicle)

Mich.—Esther

CLEMENS,

M. Whetzel and Harvey G.
are

Inc.

now

Waddell

with
.

Whetzel
Reed,

Volume 174

Number 5064

...

The Commercial and Financial Chronicle

(1861)

New York Security Dealers Association

Lawrence C. Marshall, President of the Bank of the Manhattan
the

Securities

Exchange Commission;
of

the

New

York

Co.; Harry.A. McDonald, Chairman of
David Morris, David Morris & Co., President
Security Dealers Association

Arthur

Phelan, Federal Reserve Bank of New York; Clarence E. Unterberg, C. E. Unterberg
John J. Mann, Chairman of the Board of the New York Curb
Exchange; Edward T.
McCormick, President of the New York Curb Exchange

Hal

E. Murphy, Commercial Sl Financial
Chronicle; Herbert D.
Knox, H. D. Knox & Co., Inc.; "Duke" Hunter, Hunter & Co.

Carl

Leroy Klein, Lebenthal & Co.; Elbridge H. Smith, Stryker & Brown;
y
Irving L. Feltman, Mitchell & Company

Stolle, G. A. Saxton & Co., Inc.; H. Warren Wilson, Union Securities Corporation; George Geyer,
Geyer & Co. Incorporated; Samuel E. Magid, Hill, Thompson & Co., Inc.

Wesley M. Bishop, Smith, Bishop & Co., Syracuse, N. Y.; Hanns E. Kuehner, Joyce, Kuehner & Co.;
Robert M. Topol, Greene and Company; Kurt H. Grunebaum, New York Hanseatic
Corporation; Maurice Hart, New York Hanseatic Corporation
'
'

Thomas

Larkin,

■

Co.;
,

■

Frank Becherer, Irving Trust Company; Richard Abbe, Shields &
Company; Lester Frenkel, Ge/sten & Frenhel

Harold

Goodbody,

James

Cleaver,

all

of Goodbody & Co.

Wallace H. Fulton, Executive Director, National Association of Securities Dealers, Washington, D.
Edward C. Gray, Executive Vice-President, New York Stock Exchange; Professor 0. Glenn

Saxon, Professor of Economics, Yale University; Frank Dunne, Dunne & Co.

C.;

(1862)

The Commercial and Financial Chronicle

...

Thursday, November 15, 1951

Twenty-Sixth Annual Dinner

Lloyd E. Lubetkin, Seligman, Lubetkin & Co., Chairman of the Dinner Committee; George J. Varley,
Bank of the Manhattan Co.; Thomas J. Cahill, Bank of the Manhattan Co.; Thomas D.
Byrnes, Bank of the Manhattan Co.

George A. Searight, Eisee & King, Libaire, Stout & Co.; Shelly
Pierce, New York Journal of Commerce; Charles H.
Dowd, Hod son & Company, Inc.

Louis P.

William Eiger,

Hatz, Arnhold & S. Bleichroeder, Inc.

Goodbody & Co.; John R. Stein, Frank Ginberg & Co.; Arthur Vare, Hourwich & Co.

Hough, Schafer, Long & Meaney; George L. Collins, Geyer & Co. Incorporated; Belmont
Towbin, C. E. Unterberg & Co.; John Connell, Amott, Baker & Co., Incorporated;
Oscar S. Schafer, Schafer, Long & Meaney

Singer, Troster, Singer & Co.

Sidney Jacobs, Sidney Jacobs Co.; Ely Batkin, Batkin & Co.; Clifton B.Smith, Francis I. du Pont &Co.;
Arthur

Clinton

Philip F. McManus, New York Hanseatic Corporation; Gustave
Schlosser, Union Securities Corporation; Robert E. Define,

Wertheim & Co.

Melville

John

Wien, M. S.
J. O'Kane,

Wien & Co.; Dr. T. P. Chou, guest; Samuel B.
Cantor, S. B. Cantor &
Jr., John J. O'Kane, Jr. £ Co.; Irving A. Greene, Greene and Company

Julius Golden, Greene and Company; Sal Rappa, F. S. Moseley & Co.; Harry L. Arnold,
Goldman, Sachs & Co.
i

Co.;

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1863)

At the Waldorf-Astoria Hotel

Robert

Strauss, Daniel F. Rice

Company, Chicago; Edwin L. Tatro, Edwin L. Tatro Company;
Clemence, Gersten & Frenhel

Frank

Edwin G.

Louis

Loss, Securities

Peter

Exchange Commission, Washington, D. C.;
Exchange Commission New York City

W. F.

Byrne, Securities &

Abener Goldstone,

guest;

Richard B. McEntire, Commissioner of Securities

Jacobson,

Harold Friedman and Martin

I. King, all of Sutro Bros. &

Manufacturers

Trust Co.

Calvin

& Frenhel; William James, Chemical Bank & Trust Co.; Chris J.
Rais,
Bullock; Jack Hunt, Stroud & Company, Incorporated, Philadelphia

Moss, National Quotation Bureau, Inc.; Louis E. Walker,
National Quotation Bureau, Inc.

Exchange

Commission,

Washington, D. C.; Joseph G. Connolly, guest; George S. Parlin, Securities & Exchange Commission,
New York; C. Stanley Duggan, Securities & Exchange Commission, New York;
Samuel Weinberg, S. Weinberg <£ Co.

Hans

Hall, Gersten

Co.; William S. Vanck,

John

Halsey C. Brewster, Allen & Company; Herbert Singer, Singer, Bean
<fi Mackie, Inc.; C. Merritt Coleman, Allen <&
Company

Stevenson, Singer, Bean & Mackie, Inc.; Harold J. Williams, Boenning & Co., Philadelphia;
Edward J. Caughlin, Edward J. Caughlin & Co., Philadelphia; Michael J.
Heaney, Michael J. Heaney & Co.

Eugene

Treuhold, L. F. Rothschild & Co.; James F. Fitz-Gerald, W. L. Canady & Co., Inc.;
Ginberg, Frank Ginberg & Co.; Wilfred N. Day, Chas. A. Day Sl Co., Inc., Boston

Frank

<1864)

The Commercial and Financial Chronicle

November

R. Frumberg, Securities

Exchange Commission, New York City; Shepard Kole, Kole & Kole;
New York Curb Exchange; Anthon Lund, Secuiities & Exchange

John J. Mann, Chairman of the

Commission, Washington, D. C.; Edward A. Kole, Kole & Kole; A. M. Metz,

William Boggs, Hill, Thompson &

Co., Inc.; Thomas J. Love, Geo. E.

Snyder & Co., Philadelphia

Barbier, G. A. Saxton & Co., Inc.; William A.
Edmund J. Davis, Rambo, Close & Kerner, Inc., Philadelphia

J. William Kumm, Dunne <6 Co.; Leslie
& Co.;

Everett W.

„

Horace I. Poole, Eisele & King,

New York City

Jay Schwadron, Burke & Company; John O'Mara,
Co.; Lawrence Wren, Allen & Company

Paul A. Gammons, Bradley, Gammons & Co., Inc.; Harry MacCallum, Jr.,
Vernon, N. Y.; Luke L. Benz, Bradley, Gammons & Co., Inc.; William

Russell, Mabon

Snyder, E. W. Snyder and Co., Syracuse, N. Y.; William Moran, Securities & Exchange
Commission, New York City; Stanley L. Roggenburg, Roggenburg & Co.; John J. Kelly,
National Association of Securities Dealers, Inc., New York

Thursday, November 15, 1951

9th, 1951

Irwin

Pershing & Co.; Ed Beck, Commercial & Financial Chronicle; Paul Rowen, Securities
Exchange Commission; Russell M. Dotts, Woodcock, Hess & Co., Inc., Philadelphia;
Harold P. Woodcock, Woodcock, Hess & Co., Inc., Philadelphia

Harold B. Smith,

...

Goodbody &

MacCallum & Co • » Mt.
P. Kelgard, guest

Libaire, Stout & Co.; Thomas F. Melia, The R. F. Griggs_ Company,
McCullen, Hendricks & Eastwood, Inc., Philadelphia;

Waterbury, Conn.; William J.

T. Reid Rankin, R. M. Horner & Co.

yolume 174

Number 5064

*i he Commercial and Financial Chronicle

Savings Bends Subject

Bank and Insurance Stocks
By

II. E.

Our

Reporter

JOHNSON

Governments

Of "On Trial" TV Forum
Leslie Gould and A. Wilfred May

By JOHN T. CHIPPENDALE, JR.

air

This Week—Bank Stocks

The government market continues to

for

Security-First National Bank of Los Angeles
The

present Security-First National Bank of Los Angeles
represents the consolidation on March 30, 1929 of Security Trust
& Savings Bank and Los Angeles-First National Trust &
Savings
Bank under National charter.

The history of t'he two consolidated

banks goes back to 1875.

Security-First National at the end of last year ranked as the
ninth largest bank in the country. It conducts a general commer¬
cial, trust, and savings business. Operations are conducted through

cipally in the Los Angeles
Between 1940 and

California, prin¬

area.

growth in population

approximately 53%. This fact and the expansion of industrial
activity in the area have been reflected in the growth of Security-

First National.

Treasury Bills and Certificates goes on in volume despite tight
market conditions.
There is, however, a not unimportant
demand apparently developing for the intermediate term obliga¬
tions, which is bringing about a modest lengthening of maturities.
Commercial

banks in various sections of the country, according
reports, are doing selective buying of the higher income obliga¬
tions, but these purchases are not sizable enough yet to give any
clues as to what might be in the wind.

Volume and activity in the longer maturities is still

175%

in de¬

posits which has taken place during the
p^st ten years.-At the
same time capital funds of the Bank have almost doubled.
Development of Security-First National Bank of Los Angeles
following tabulation.

since 1939 is shown in the

-Common Share-

Capital

1950__

Book

Funds

Value

$1,702,042,138 $99,602,312
1,602,887,763.
89,800,000
1,619,817,087
85,800,000

1949_.
1948_.
1947_.

1,650,555,265
1,633,051,837

Divi¬

Price Range

dends

High

among

bonds, most of them
from other tap issues.

growing interest developing for the intermediate-term matur¬
This buying, although spotty and hesitant at times, seems to
gradually assuming more importance, especially among the

561/2

commercial banks.

71.50

7.58

2.70

64I/2

52%

somewhat

■67.87

6.25

2.40

641/4

521/2

5.36

-2.40

83%

52.67

5.08

2.40

6.29

2.40

501/s

46.83

5.76

2.25

501/8

36%

1942..

44.75

5.68

•2.30

44%

321/2

1941..

66-6,566,255

54,060,000

40.05

5.95

2.60

48%

38%

1940..

619,636,922

52,060,000

37.55

5.30

2.60

511/4

1939..

580,438,057

52,060,000

36.72

6.02

2.60

4iy2

share.

not

Bank
a

retired

$6,000,000

$12,000,000

struction Finance Corporation

of preferred stock, the
issue borrowed from the Recon¬

1934.

At present the capitaliza¬

tion consists of 1,200,000 shares of $25 par common stock.

Including these profits, net earnings last
$10.69

compared with $8.28

would be

year

the

earlier.1

equal to

basis

same

year

Nov.

and

A. Wil¬

fred May, Executive Editor of the
Commercial and Financial Chron¬
be John

and his counsel will

ness

Bronx

mer

County chairman, War
Committee, U. S. Treas¬

Finance

The opposing counsel will be

ury.

Mark

F. Hughes, New York trial
lawyer and a member of the As¬
of

the. Bar

the

City

York.

New

Financial

Gould,

Editor

of the New York Journal-Ameri¬
and

can

writer of the syndicated

column,

"Behind the News
in
Business," will be the expert wit¬
ness

the

Nov.

session.

Mr.

Hughes will act as his counsel,
and the opposing counsel will be
Robert W. Coyne, New York law¬
and former national

yer

the

director

Finance

War

Trial," which is presented by the

buying of the intermediate-term obligations,

indicated

that

the

among

the

most

addition to the

appears

Far

West

consistent

the

and

these

have

West

Middle

purchasers

been

obligations.

buying of the middle maturities, there has been

side
ABC
-in

both

over

Public

sessions

Affairs

cooperation with

"On

Department
the

tion of the Bar of the
a

Associa¬

City of Nev#

York.

slightly enlarged interest appearing for the most distant eligible
buying

has

had

the

future, because there

near

are

far this

nor

quite

are

development.

be indicated yet, because there still

other attractive investment

many

appearance

encouraging

mediums

commercial

for

Group io
Spring Meeting

Hold

into the

move

Nevertheless, the

yet,

go cannot

Texas IBA

few holders of this ob¬

highest yielding bank obligation, which is not

proportions
may

price

the

upon

is it likely to have in

willing to let it out in order to

are

substantial

How

1967/72,

eligible restricted bonds.

bidders for the

influence

great

action of the 2V2S of September

ligation that

high last year
amounting to $8.33 a share. This figure does not include $2.36 a
share which was obtained from security profits and recoveries.

"On
p.m.,

to be

new

10:00

spread out, with no specific section of the country having a
greater interest than another. However, according to reports, it

This
well

earliest

Operating earnings of the Bank reached

lengthy maturities has not been significant enough
few

bond.,-This
the

9:30

Division,
S. Treasury. ./■/•
/■
■
William B. Groat, Judge of the?
Queens County Court, will pre¬

1951, Security-First National had deposits of
Capital funds totaled $102,835,000 and the book

value of the stock had increased to $85.70
1942

the volume and activity among the

sure

developments; but it is bearing out the predic¬
money market followers that the issues out
through 1956/59 would become increasingly attractive to the de¬
posit institutions.
/ ''
:
tions

of Sept. 29,

To be

to create unusual

64.53

49.33

ABC-TV's

the Nov. 20 session

Leslie

66V2

56,200,000
53,700,000

remaining part of

Finding Favor;

ities.

72%

1,104,741,047
806,484,204

from

Savings

"Do

Fair Return?" will

EST, on Tuesday,
Tuesday, Nov. 27.

Despite the strong and consistent demand for Treasury Bills
tight money conditions, which gives
healthy glow to the near term end of the list, there appears to

3.00

1,340,701,440

$1,672,684,000.

f."/■

and Certificates in the face of

$3.25

1943_.

Trial"

sociation

8.10

1944_.

being acquired through exchanges

are

Intermediates

$8.33

1,654,455,926

topic

timely
Give

discussed

Kadel, New York lawyer and for¬

74.83

1945_.

the restricted obligations. There appears to be a somewhat
enlarged interest developing in the 2!/2S of 1962/67, with the June
1959/62s not quite
as
much in demand as a short time ago.
Although there has been some new money commitments in these

to be

$83.00

81,440,000
77,440,000
63,200,000
59,200,000

1946_.

The

Bonds

icle, will be the affirmative wit¬

Low

ABC-

TV Network.

a bit on the professional side, even though there
moderate increase in switches and swaps, especially

Oper.
Earns.

and"

light

evidently quite

two

The balance sheet figures reveal the increase of

Deposits

means

money

seems

1950 California had

opposing views

strong demand
the purchases of

display

liquidity and the riskless issues, which

133 offices and branches in Central and Southern

(1865)

DALLAS, Tex. -—^The TexasGroup of the Investment Bankers
Association have chosen the Hotel

Galvez, Galveston, Texas, for their
spring meeting to be held May i
and

May 2, 1952.

{■•

banks.

Dividend payments have also gained in the last 12 years. The
payment of $3.25 a share which has been disbursed in the last two
years represents a conservative portion of the operating earnings.
Last year it amounted to only 39%. Thus there is considerable
reason to expect a larger payment in
coming years. Dividends
have been paid in each year since 1880.

The bank's ratio of deposits to capital funds is approximately
17 to 1, so it is likely that a large portion of earnings will continue
to be retained to augment capital funds. This has been the means

Da vies & Co.
Partial
Even
lected

though there has been

bank

moderate

new

interest in

se¬

partially exempts, especially the last three matur¬

At the present time it appears to be pretty

much of

toss-up

that have been used in the past.

Security-First National is

the large rapidly growing banks that has
not;
shares to existing stockholders or the public.

one

yet, sold new

which

one

of the 2%s

commercial banks.
able

for

purchase

is the most popular issue among the

It appears to be a case of

than

which

anything else.

one

Recently it

is avail¬
was

in¬

few

the other two

present time the stock is quoted at 84 bid at which price it yields
3.87% on the dividend of $3.25 paid this year.

Robinson-Duff,

Jr.,

of the New York Stock
on

Dec. 1,
Davies

member

Exchange,

will become a partner
Co., members of the

New

York

Stock

Exchanges. The firm's main

and

San

office is in the Russ
Francisco.

Francisco*

Building, Sam

:v.

dicated

of the

1958/63s have

out of hiding

come

than

•

The shares of Security-First National have a
fairly wide mar¬
ket and so far this year have sold between 85 and 66%. At the

Admit

Robinson-Duff Jr.

eligibles—that is, the taxables—there is still a good

demand for the

ities.

Exempts Equally Attractive

the

makes

the

(the 2%s of 1956/59 and the 2%s of 1960/65), which

2%s due

1958/63

the

for

the

moment

bellwethers of

Dave H.

Coddington, member of
the Exchange, will withdraw from
partnership

Davies &

Co.

Nov. 30.

higher income partials. In this group, the buying, according to

report, has

come

mostly from the Pacific Coast, with

of the

some

competition being supplied by commercial banks in the Midwest

Boston Investment Club

Curtis:

Lucien O. Hooper, Chief
Analyst for W. E. Hutton & Co.;
Prof.

Dinner November 19
BOSTON, Mass.—The next din¬
ner

meeting of the Boston Invest¬
ment Club will be held Monday,
Nov. 19, at the Boston Yacht Club
at 5:30

p.m.

There will be

panel discussion

the subject of "Securities Out¬

look

for

Those

the

Months."

participating in

the

panel

Douglas H. Bellemore, Head

the

Department

Finance,

Boston

Economics

University,

and Investment Economist for the

American
and

Institute

Nelson

United

(United

iate).
The
also

Investment

Business

.:.

Conant,

Finance,
President
Counsel

Service

affil¬

Boston

announces

will be:

Christmas

for

Investment

that

Club

their annual

Dec. 11.

Sidney B. Lurie, Analyst
Paine, Webber, Jackson &

Party

England.

Volume

whole continues to be about at the levels it has

will

held

U. S. TREASURY

been at in recent weeks, which means that the greatest activity
the

and

largest business is being done in the short-term matur¬

STATE

The desire, if not the need, for liquidity is as strong as ever,-

ities.

this coupled

with the desire again to reduce the risk factor

is keeping more than a small number of financial

income

taxes,

and

MUNICIPAL

This kind of buying is not by a

Treasury Bills and Certificates.

some measure

amount of money that is being put

Funds for

international

domestic and

the confused

ture, is no doubt responsible in

and

institutions in

long short confined mainly to the deposit institutions.

V' I

and New

pic¬

SECURITIES

for the fairly sizable

into near-term Treasury obli¬

gations by others than the deposit banks.

Restricteds Quiet

BANK

NATIONAL BANK

and

of INDIA, LIMITED
Bankers to the Government in

Head

Office:

26, Bishopsgate,
London, E. C.

Branches in India, Burma, Ceylon, Kenya

Colony,

Laird, Bissell & Meeds

Teletype—NY

Kericho, Kenya,

Subscribed

Exchange

Paid-up

N. Y.

Reserve

Telephone: BArclay 7-3500
Bell

and Aden

The Bank

1-1248-49

Capital

Capital.
Fund

switching

going

even

though there appears to be

the

among

The earliest

various

maturities.

the

object

eligible tap issue, the 2V2S due 1962/67, appears to be

tion

with the

of considerable affection recently,

ation-minded buyers taking a
the

expense

some

appreci¬

£4,000,000
£2,000,000
£2,500,000

and exchange

business

Trusteeships and Executorships
'

Aubrey G. Lanston

fairly good toe-hold on this obliga¬
of the higher-yielding

issues.

& Co.

The

2%s

of June

1959/62 to be

also, but not nearly as much

sure

have

was

the

been

given consideration

case a

few weeks ago.

Scale orders continue1 to be the pattern of the times as far as

Broad

Street

NEW YORK 5

45 Milk Street

BOSTON 9

Conducts every description ot

banking
-

bit

bonds, volume and activity has not ex¬

appreciable extent

INCORPORATED

(L. A. Gibbs, Manager Trading Dept.)

Specialists in Bank Stocks

any

and Zanzibar

Members New York Stock Exchange

York Curb

panded to

restricted

*•

Kenya Colony and Uganda

STOCKS

Members New

the

INSURANCE

120 BROADWAY, NEW YORK 5,

As to

the Vies

are

concerned, with it not being so easy now to get pros¬

pective buyers to change/their

price ideas.

They appear to be

also undertaken

rather willing to sit backhand wait

it out.

Whitehall 3-1200

' HAncock 6-6463

Continued

Mordecai Cohen Opens
BROOKLYN, N. Y. — Mordecai
is engaging in the secu¬

closed-end company

page

Buy

Court Street.
the paper companies.
the building industry

Balance

dividend

yields,

earnings,
an

relative

continuation

earnings
and
divi¬
for some time, your man¬

substantial

67.5%

man

absolute sense t and
bond yields, and the

f6r

prospect

Axe-

were

15, 1951

Houghton

Corporation which raised an
were again additional $8 million through sale
reduced and commitments in the of
130,000 shares to its present
aviation field were lightened.
stockholders.
During this same
Holdings in

above

Thursday, November

both, in

changes

Other

equities.

included

...

rent

decreased its

percentage ot assets committed to
not

Funds

at 16

business from offices

from first

junior

Cohen
rities

Chronicle

The Commercial and Financial

(1866)

dends

95%

"A" from
80.0% to
and
Fidelity Fund from

agement,

87.9%.

temporary

Discussing the extreme shift in
the
the

while recognizing that
reactions
ih stock

prices are an ever-present possi¬
bility, feels that good common
stocks on a long-pull basis are not

composition of the portfolio of
Stock & Bond Group of In¬

third quarter ynder review the stitutional Shares, Emlen S. Hare,
overvalued."
This statement is
stock market as measured by President, in a letter to share¬
dated Oct. 17.
•
Standard and Poor's 90-Stock holders accompanying the divi¬
Other managements stress the
drew down on their cash reserves Composite
Average rose 11%, dend distribution on last Aug. 31
during the period. Special reasons °ver the 12-month period ending stated: "During the last two years, type of common stocks to be
for
example the
existed
for
some
of
(investment), inclusive of selected, as
these
de- on Sept. 28, the increase in stock your
of
The - Shareholders'
creases.
Boston Fund increased prices was almost 20%, and, based distributions
paid from realized trustees
its better grade senior equities by °n the same averages, share prices security profits but not including Trust of Boston in their quarterly
$4 million and prior liens by $6 have risen 72J/2% since the 1949 dividends paid from investment report released on Oct. 22: "All
million thereby strengthening its lowsStudents interested in the income, has shown a very substan¬ industry is laboring under tfie
defensive position in spite of its sound development and growth of tial appreciation in market value burdens of rising costs, increased
smaller total of governments and the open-end or mutual fund in- of
approximately 70% and our taxation and price controls, and it
cash. Blue Ridge Mutual Fund re- dustry have questioned
whether purpose in balancing the fund at is essential in the selection of in¬
quired $16,600,000 to redeem the pressure of new funds coming this time between securities and dustrial common stocks to stress
cash is not only to preserve the those equities representing indus¬
shares
held
by former Central jnto the treasuries of these cornStates
Electric bondholders
and Panies, especially of those concen- gain, but, of equal importance, to tries having characteristics which
these
burdens.
It is
preferred stockholders since or- trating purchases in common be in a cash position to reinvest minimize
ganization as an open-end fund stocks, is resulting in portfolio promptly at, lower prices when still the opinion of the Trustees,
on June 28 of this year. (It is unacquisitions at what may well we feel the market has fully dis¬ the Advisory Committee and the
counted unfavorable factors and Investment
Adviser
that
the
derstood that few of the former Prove to be peak prices,
reached a bottom from which it strongly
closed-end Blue Ridge holders reentrenched
companies
While
extreme shifts to dequired the new company to re- fensive positions may indicate an may be expected to resume its up¬ controlling basic raw material re¬
Notwithstanding

purchases

the

excess

sales, only onethird of the companies surveyed

from

Prospectus upon request
your

investment dealer, or from

National

securities

corporation

research

120 BROADWAY, NEW YORK 5, N. Y.

%LUNGI0N

over

inclination to gamble, little or no

deem.)
or
of

excess
Excess

Of course, consideration
relatively
few
funds

question.

IS interesting to observe that
actual number of investment

the

TO.il

whose

companies

prospectus
your

dealer

investment

purchases

increased

ceeded

from

sales

of the

second

be open to

change might well

Purchases
purchases

period of the

policy it is to maintain a
fully invested position is excluded
whose

ex-

that

over

tbose

But let us com-

tn this discussion.

.year.

1Q(-i

1Q-n

open-end stock funds bringing to
num-

not over 65%

those

stocks

addition

The

PHILADELPHIA

2, FA

trusts

ber

occurred

almost half the

covered

one

of these two

K'''2V J

/'KK

-'v

'fl-.

•'»'

••

•

-'•••

Boston

Liul of

Howard

able

distributions

dividend

time

*'■!,'

49.7
53.9

64.3

63.6

to invest

statement

Incorporated

invested

53.5

sulting

62.4

61.9

53.2

50.5

Wellington Fund

...

General

Established 1394

Institutional

New York

One Wall Street

Investment

Shs.
Co.

Knickerbocker

(Stock & Bond Gr.)

America

Loomis-Sayles Second Fund

fects.

The

prices

level

the

past

general

lic

centrated

73.0

values.

Considering

cur¬

each

66.7

77.0

particular

most

of which

was

acquired by

71.3

79.3

76.2

78.0

80.0

73.1

80.0

Fund

Street

Investing Corp
Investing Corp.

Standard
*Dec.

56.0

Fund, Inc.
Prospectus

Investors.

...

&
31,

Poor's

79.5

1950;

90-Stock

September

figures

not

available.

changes, four stock funds geared

portfolios defensively to highpriced stock levels.
Only ,one

funds

request Y;

184.7

moderately to more defensive positions
and,
excluding
extreme

balanced

upon

70.8

154.4

...

shifted

Two

Affiliated

Companies—•
American

General

National Shares Corp..___

Loud, Abbett & Co.
New York

Chicago

—

Atlanta

—

Los Angeles

,...

1925

FOUNDED

BONDS
MUTUAL

the

Thus,

54.6

Investment

Closed-end

investing their capital in

...

preference shown for pub¬
utilities was not overly-con¬

The

57.6

51.7

Wall Street

INVESTMENT FUNDS

will have far-reaching ef¬

power

of Rhinelander Paper:

33.1

58.0*

State

Participation in

year

78.7

92.8

Fund

England Fund-.-..-.-..—
Republic Investors ....f

Certificates of

fiscal

the

July 1, 1952. The re¬
increase
in
purchasing

trinsic

80.9

...

New

Custodian Funds

dollars

77.3

25.3

55.0*

Mutual

Keystone

47.8

87.5

56.3

59.3

Loomis-Sayles Mutual Fund
,

was

Sept.

66.4

Corporation

Capital

preferred
Co. Other

issues.
popular stocks
were
'Central
and
Southwest
criterion as
to
whether current
prices are
high
or
low.
Such Corp., Middle South Utilities, the
determination
in
our
judgment Southern Company and New Eng¬
must be made on the basis of in¬
land
Telephone and Telegraph,

80.5

& Howard Stock Fund

Mutual Trust Fund

First

CALVIN BULLOCK

billion

stock

Bowling Green Fund
Eaton

stock

96.3

—

Common Stock Funds—

the

the Monterey

-shares

10,000

in
and

83.3

Whitehall Fund

invested

was

petroleum issues acquired were
almost
Husky Oil and Refining, Ltd. by
with
Incorporated Investors and Can¬
92.8% of assets in common stocks:
ada Southern Oils, Ltd., by State
"Most
industries
cannot
fail .to
Street Investment Corp. Bullock
feel the stimulating effect 'of a
Fund made an initial purchase of
Federal budget that is expected to
Kobacker Stores while the George
call for expenditures of 80 to 90
Putnam Fund bought 6,000 shares

holders.

56.4*

Clark

Royalty Co. and
all purchased by
Corporation. One mil¬

13.83% of the voting common

beginning

usual

dollars

lion

report

52.8

the Lehman

accompanying the quar¬

of Incorporated In¬
vestors made by its President Mr.
William
A.
Parker,
to
stock¬

terly

60.2

...

quite as
and consisted

not

were

Monterey Oil Co.,

^Contrasted with the above is the

51.6

Securities

Scudder Stevens

dealer

numerous

have

Depreciation

Monetary

39.5

Boston.

quarter

Co.,-'Southland

Secular

61.9

Nation-Wide

investment

the

chiefly of equities of oil com¬
until such
panies. Included were Anglo-Ca¬
advisable
nadian Oil Co., Ltd., Royalite Oil
fully in stocks."

57.3

Fund

portfolios during

Newcomers to

en¬

it again appears

Mutual

Prospectus from your

large

productive research organizations
possess such characteristics."
-

annually

paying
as

Fully Administered Fund (Group Sec.)

A Mutual Investment Fund

sufficiently to

and companies with

sources

have

to maintain the amount of

fully

54.8

Fund

Balanced

thus

September

55.9;;

Shares.

Fund

-Eaton

80%

3950

V
V..

Business

com_

na com

and
'."-V

Balanced Funds-tAmerican

closed_end

stocK ana cios a

Percent of Common Stocks
v;5. V-.".• 1'•
v

reduced income

open-

invested:

the Leh-

was

and

Panies with not over

closed-end funds

were

of assets in common

equivalents

profits

realized, in reducing our position
in common stocks, will augment

balance.

total of 27
and

survey

buying portfolio secuOnly two of this

companies

rities

this

the

among

(also) expected

the security

been

™

p
q y p
sitions of balanced funds holding

that

It is

trend.

ward

INVESTMENT FUNDS

(Series B1-B2-B3-B4)

MUTUAL

PREFERRED STOCKS
(Series K.1-K2)

¥d STOCK FUND
COMMON STOCKS
(Series S1-S2-S3-S4)

Street, Boston 9, Mass.

Please send

ten

SELECTIVE FUND

FACE-AMOUNT CERTIFICATE COMPANY

Keystone Company

The

50 Congress

your

'/?fj

prospectuses

SYNDICATE OF AMERICA

describing

Organization and the shares of your

Funds.

Diversified Investment Company
Announces

Prospectuses of these companies available at offices
in

148

the national distributor and investment

manager.

for Purchasing
DIVERSIFIED SERVICES,
Established in 1894

City
y

State

D18

MINNEAPOLIS 2, MINN.

new

PROGRAM

Name

Address..........r.

SYSTEMATIC INVESTMENT

principal cities of the United States or from

INC*

its Shares

(

be obtained from your local
investment" deafer or The Parker Corporation,

Prospectus

may

200 Berkeley St., Boston 16, Mass.
!

Volume 174

Number 5064

five managements. A

west

5,800

making

purchased, although off¬ tively. American Telephone, which
three sales which by contrast had been top favorite
the
June
period,
was
still
up
to 77,800 shares. In¬ in

was

setting
added

ume

the minus side. The

Tele¬

thpre

were

sales.

three

One

Niagara
four

for

the

former

had

Five purchases totaled 13,400

other trusts.

In the

second quar¬

was

Illinois

liquidation in this

utility had been one of the
issues in which sellers had

there

but

Northern

the New York State

Electric, half of
also

acquired

through

tric. One sale of each of the latter

4,900

Eight

managements added 37,700 | two companies was made by Blue

7,700

utility. There

commitments in

two initial

Commonwealth

three

and

Rochester

Gas

and

rights.

shares of this latter company,

Niagara Mohawk. .Single sales in

[ States

Power,

two i Ridge- Mutual

St.

ments

in¬

trusts

Safeway

Two

Macy.

de¬

portfolio

were

manage¬

total of 20,600

Western

Auto

Supply,

Woolworth and
shares of H. L. Green Co.
Continued on page 33
of

Invest. Bonds &
Net Cash & Gov'ts

Thous. of Dollars

46.8

49.7

11.8

58.4

67.5
70.2

29.9

24.8

23.3

3,984

29.1

20.7

12.5

1,471

5.1

6.9

23.7

22.9

71.2

5,-348

2,686

8.4

3.7

33.1

42.4

58.5

53.9

3,047

8.6

18.3

19.2

72.5

72.2

Mutual

15.1

6.6

.61.8

29.4

30.6

-33.7

50.5

51.1

9.8

9.4

39.7

39.5

298

20.4

12.2

2.6

77.0

77.1

10,298

2.2

3.4

30.3

10.7

27.3

22.2

19.6

13.6

13.5

5:5

3.0

37.0

36.8

57.5

60.2

468

549

2.2

2.4

19.9

18.8

77.9

78.8

3,414
3,159

19.8

19.1

29.7

28.1

50.5

52.8

3,312
5,554

11.9

6.3

20.5

21.1

67.6

72.6

.1: 7,501

7,570

21.6

20.3

23.4

26.2

55.0

53.5

406

440

6.9

6.6

20.9

18.0

72.2

75.4

30,562

16.9

16.3

20.3

21.8

62.8

61.9

28,998

Clark.

Shareholders Trust of Boston

Wellington Fund

5.2

4.8

46.6

44.7

48.2

50.5

14.9

13.9

5.4

5.3

79.7

4,349

3.7

2.9

0.2

0.6

96.1

27.3

19.4

6.8

21.3

65.9

59.3

6,714

19.5

22.0

None

00.5

78.0

1,492

7.7

6.3

5.8

4.8

86.5

88.9

2,063

17.6

16.3

0.5

81.9

83.2

1,920

170

1.3

1.6

1.5

97.1,

96.9

112

17,673

18.5

17.4

None

81.5

82.-3

17,019

1,171

12.0

10.5

None

88.0

87.5

1,093

5,418

16.4

8.8

2.4

81.2

87.9

8,498
47

1.5

1.1

61.2

73.6

4,286

3.3

3.9

1.6

0.8

1,707
111
6,530

3,584

13.2

22.7

None

103

6.2

4.4

None

93.8

95.6

7.2

None

93.4

92.8

8,252

6.6
37.5

52.2

None

47.8

1.477
3,187

62.5

837

Fund

Bowling Green Fund
Blue Ridge Mutual Fund
Broad Street Investing
'
Bullock Fund

Delaware Fund

Dividend Shares
Eaton

Howard

Stock

Fidelity Fund —
First Mutual Trust Fund

General Capital Corp

Group Securities—Common Stock Fund

Incorporated

Investors

Institutional Shs.—Stock & Bond Group

18.5

20.3

1.0

80.5

78.7

Investment Co. of America

Investors

2,573

Mutual Investment Fund

New

Investors

95.3

95.1
*

;

77.3

86.8

...

2.6

3.7

1.2

96.2

58.0

11.4

8.9

53.4

33.1

37.6

33.5

11.0

10.5

51.4

56.0

3.478

36.2

32.0

9.5

10.4

54.3

57.6

3,854
9,683

2.0

2.2

None

98.0

97.8

3.0

5.4

None

97.0

94.6

1,746
167

24.1

14.8

28.9

30.6

47.0

54.6

2.7

1.9

None

97.3

98.1

523

1,160

30.7

25.0

9.0

24.0

5.8

19.6

22.9

1,265

England Fund

;

1.2

60.3

;

CO., INC.

York 5, N. Y.

52 Wall Street, New

Telephone

T eletype

WHitehall 4-6120

N Y 1-3125

71.3

Republic Investors

FRANK L. VALENTA &

-36.7

56.4

8.3

1,183

324

10.4

8.5

None

91.5

1,892

39.6

2,017

None

Selected American Shares...
-

Prospectus on request

95.1

35.2

235

.....

528

9,099

-370

National

25.3

37.3

849

...

Fund

2nd

3,595
4,076
7,764

...

Loomis-Sayles Second Fund......
Massachusetts Investors Trust
Massachusetts Investors

3.3

327

Loomis-Sayles Mutual Fund

2.0
'

5,301

Fund

Management

Knickerbocker Fund

33,

3,081

Fundamental Investors

RESOURCES FUND, INC.

96.5

157

Open-End Stock Funds:
Affiliated

NATURAL

80.8

11,829
1,557

601

202

....

Investment

106

555

4,486

Whitehall Fund

Chicago 3, Illinois

66.9

;

George Putnam Fund.
&

135 S. La Salle Street

69.3

240

Nation Wide Securities

•

100

...

National Securities—Income

67.5

64.2

Johnston Mutual Fund

§M.utual Fund of Boston

MANAGEMENT CO.

63.6

3,156

TELEVISION SHARES

72.3

5.8

258

Scudder-Stevens

21.1

6.9

460

General Investors Trust

23.1

5,898

Fully Administered Fund—Group Secur.

147

4,382

2,918

3,358

159

Eaton & Howard Balanced Fund

9.2

4,766

^Dreyfus Fund

Wisconsin

25.5

investment dealer or

Sept..

974

Commonwealth Investment

June

9,164

Axe-Hougton *'B"

Investors

Sept.

June

4,712

Axe-Houghton Fund "A"

your

End of

Sent.

10,589

American Business Shares

Boston Fund

Per Cent

Per Cent*

-End of
June

Sept.

June

Open-End Balanced Funds:

Grade Bonds & Pfds.

Per Cent

End of

Prospectus on request from

Com. Stks. Plus Lower

Preferred Stocks

Net Cash & Gov'ts

50 State Street, Boston

One fund sold 1,500
latter, store stock,

End of Quarterly Periods, June and September, 1951

Putnam Fond Distributors. Inc.

Companies

Balance Between Cash and Investments of 62 Investment

cf 3)o6t<m

and

Macy

purchased

be¬

undoubtedly

the

creases

Joseph Light
which stock was \ and Power and West Penn Elec¬

issue

nor

holdings

2,800 shares.

funds

two

Power,,

number

same

creased

decreased

3,500

the

number acquiring 9,000 shares of

\yere

FUND

during the

held

been

quarters of the current

setting were three sales amount¬
ing to 3,800 shares. Next in popu¬
larity were Macy and Safeway
Stores. Three funds added a total

ter this

were

There

PUTNAM

first choice in this group

two

year.

stock from their portfolios. No ad¬
ditions were made to holdings by

;

18,700

and

scattered and not first

completely eliminated the

whom

3eorye

mer¬

heavy. Iowa-Illinois Gas and

acquired
by
11
managements two
were purchased through the exer¬
predominated.
Also
cise of rights. Two initial com¬
among
holdings Uy
mitments
totaled
4,000
shares. '

popularity,

adding

managements

(

Public Utilities

of General

shared

MohawkPower
honors

second

Electric

England

New

System and 22,500 shares of Utah
Power and Light.
About two-thirds of the 31,419

and

Edison

man¬

completely
eliminated a block of 18,000 shares
of the Southern Company, while
purchases totaled 21,800 shares.
Commonwealth

which

was

the

however,

agement,

City

of Atlantic

8,500

Selling of the power and light
very

£7/e

Favored

among

acquired
chandising issues was Allied
there Stores which thus retained its

were

status

companies

Stores

favorite

The

Electric, 6,600 shares of Brooklyn [ Electric was the least popular is- shares, two of which represented
sue
with four managements dis¬
Union Gas, 2,300 shares of Min¬
initial commitments.
Partly off¬
nesota
Power and Light,
11,600 posing of 67,800 shares, half of

first
entries in portfolios; in contrast
with
the
two
previous 'issues,
stock included

by three funds were totals

added

Retail

shares added to

this special offer;
offsetting sales.

were no

Also 'V

block of 200 shares was sold.

portfolios

through

though partial acquisition resulted
from bond conversions; one small

12,600

shares of the New England

phone

by three managements, al¬

liked

cluding two initial commitments,
the
purchases of Middle South
Utilities
equalled 15,000 shares,
but a pair of sales tripled the vol¬

half of the 25,200

six

rights to its
approximately

and

shareholders

were

special circumstances

issued

Gas also

and

affecting that company.

York

New

of the

cause

portfolio
pur¬
State Electric

initial

chases.

shares respec¬

44,325

and

amounted

issue

each

South¬

and

(1867)

Commercial and Financial Chronicle

The

total of 32,-

shares of Gentral

700

3.4

3.9

6.0

90.6

90.1

14
19,337
509

21.2

0.2

0.3

73.6

76.2

23,936

23.5

611

18.6

20.0

0.8

None

80.6

80.0

1.7

1.6

92.5

92.7

81.6

84.5

Sovereign Investors
State Street Investment Corp
Wall

Street

Investing Corp.

Closed-End Companies:
Adams

2,804
1,019

American

General American

General
Lehman

Public

Investors

Service.

Securities

Tri-Continental

9.1

6.3

6.1

2.5

2.2

188

2.6

1.8

.16.4

16.6

8,672

14.9

15.7

5.2

4.3

1,021

11.5

8.0

None

7.7

11.4

27.3

25.8

7.6

2.3

None

91.9

81.-3

79.9

80.0

88.5

92.0

90.0

88.2

65.1

70.8

phone or call at our office, or

97.7

send the

None

1,723
2,589

5,724

5,078

For Prospectus,
the Fund

4.8

4.5

0.8

0.7

94.4

94.8

10.5

8.1

0.8

0.3

88.7

91.6

MAIL THE

COUPON TODAY!

♦Investment
Ba

for

for Bonds;

bonds

FName

preferred

stocks:

Change
Moody's Aaa through

Fitch's AAA through BB and approximate

preferreds.

associated

and

^Portfolio

companies.

changed

from

assets.

exclusive

§Name

Nebett

changed

Fund.

equivalents

securities in subsidiary
from

fiCash

Russell
less

Berg

Fund,

in Cash Positions of 60
Plus

Open-End Companies:
Balanced Funds
Stock Funds

L__

...—-----

...

—

Closed-End Companies

■

•

Unchanged

Totals

Companies—

Send me,
for

New York 5, N.Y.

without obligation, Prospectus
Knickerbocker Fund.

-7

than 1 % of net
Totals—All

20 Exchange Place,

Investment Companies

Dept. C

Minus

attached coupon.

[ KNICKERBOCKER SHARES, INC.
|

SUMMA R Y
FOOTNOTES

describing

and its shares,

83.9

83.5

15.0

14.8

1.1

1.7

Fund

91.7

81.0

3.4

2,418

Securities.......

0.4

2,372

Corp.__i.__

$U. S. & Foreign Securities.......

2.3

3,363

...

U. S. & International

16,067.

8,999
3,231

Corporation

National Shares Corp
Overseas

9.2

5.6

1,352

Capital Administration

9.3

1,547

7,016

International

5.8

1,187

245

—

3,122

1,260

Express

American European Securities...

5.7

Knickerbocker

Name

Address.
City

Stale.

The Commercial and Financial Chronicle

(1868)

...

1951

Thyrsday, November 15,

Changes in Common Stock Holdings of 43 Investment Management Groups
(June 29-September 28, 1951),

MUTUAL FUND
Transactions

BOSTON

Inc.

more
new

managements sold than bought

purchases

in italics. Numerals in parentheses indicate number of managements making

are

eliminating

completely

stock from

the

their portfolios.

Sold

—Bought—

Investment Manager

No. of

Trusts

dealer

Trusts

and Underwriter

19 Congress

None

Street, Boston, Mass.

300

2(1)

None

Tractor

None

5(1)

10,800

None

2(1)

500

None

4(1)

39,600
4,600

7,300

Harvester

None

2,800

Bohn

5(1)

3,000

Chrysler

3,800

3(2)

None

3(1)

2(2)

50,200

Nash-Kelvinator

None

6(2)

28,000

Studebaker

None

12,300

2(1)

4,100

4(1)

1,300

2(1)
None

None

Borg

Aluminum

Brass

—

Warner

—

General Motors

4,900
None

"B"

Wheel

Kelsey-Hayes

National

Cash

30,000
6,060

2,900

2(1)

Underwood Corp.

......

None

2,000

100

Dixie Cup

—

Kimberly Clark

3.600

Anderson-Prichard

None

Oil6———-

None

Exploration (Western) 7.

None

Atlantic

Refining

None

3(1)

2,440

Bendix Aviation

5,400

3(1)

2(1)

100

Boeing Airplane

3,600

3(1)

12,700
147,965

2(1)

2,200

Humble

2(1)

5,700

Plymouth

2,COO

Standard

Oil of Kentucky—_.

8,760

Standard

Oil

2(1)

Canada Dry Ginger Ale
National Distillers

7,500

4(3)

28,900

None

None
200

—

13(2)

British

—

American

Your Investment Dealer

4(1)

From

Refining

Oil 8
of

New Jersey

4(2)

6,500

General

4(3)

Wl/RBHEY FAVRE.INC.

2,200

9,800

Glidden 2

None

Lone

None

National

None

National

None

United

None

York

27,100

Socony

3(1)
2

3(1)

5(2)

None

7,700

2(1)

Gypsum.

Corp.

Oil

Vacuum

800

3,200

2(1)

•

-t;

6,000

None

2,500

13,500

3(1)

duPont

1,500

3(1)

Union Carbide

7,200

6(1)

1(1)

7,700

2
•»'•

None

STtECTE

4(2)

None

800

None
200

Standard
Texas

2(1)

1,100

4(2)

Shares^

Oil

of Ohio

Company

10,300

None

Container Corp. of America—

Electric10.

and

American

Gas

8,666

American

Natural

Northern

Natural

None

14,500

18,225
181,100
20,070

10(2)

7(1)
2

Gas

2(1)

29,600

request fro
dealer,

SELECTED INVESTMENTS COMPAHY
CHICAGO 3,

Salle

...

;

63,216
6,100
None

2(1)

3(2)

4,900
8,800

3(1)

8,500
6,600

5(1)

32,700 '

None

500

Colgate-Palmolive-Peet
Merck and Co.3____
Chas. Pfizer 4
__

None

4(2)

18,700
19,000

3(1)

55,100
_

12,140

—

2(1)

11(2)

31,419

None

2(1)

None

4,000 f
-3,200

None

4,400

5(2)

2(1)

Drug

——

and

None

Procter

None

Sharp and Dohme.....

Gamble...

GRANNIS

Camino, Beverly Hills, Calif.

Eastern

800

CO.

Dumont

7,000

2,200

Motorola

—

5(3)

12,600

1(1)

5,400

___.

11,600

None

35,500

25,200

4(3)

9,000
11,100
37,700

Square

6,000

1
1

2,600

Radio Corp. of America

23,900

15,000
500

8(2)
3(2)

"D"

Sylvania Electric Products

15,000 X
2,300

2,200

2(1)

8(2)
2

Financial, Banking and Insurance:

9,900

Gas

United

6(1)
r

None
None .5

None

44,200

Corp.12

None

4(D

■;

Western Natural Gas

None

Peoples Gas Light & Coke

4,100

3(2)

None

American

Chemical Bank and Trust

___

None
None

None

Surety

None

1,850

None

3,300

Commercial

9,200
2,000

Continental Casualty
Firemen's Insurance-Newark—

3,600

General Reinsurance Corp

None

1,500

Guaranty Trust, New York
U. S. Fidelity and Guaranty

None

200

Atlantic City Electric
Brooklyn Union Gas.
Central & Southwest Corp.Commonwealth Edison
Florida Power Corp..
General Public Utilities 13
.
General Telephone
Gulf States Utilities
— -—
Louisville Gas & Electric
Middle South Utilities
Minnesota Power & Light
Montana Power
New England Electric System—
New England Tel. & Tel
N. Y. State Electric & Gas 14__
Niagara Mohawk Power
Public Service Electric & Gas__
Rochester Gas & Electric 15——
South Carolina Electric & Gas__

600

1
...

None

77,800

5,800

None X

None

46,000

.-X

None

None i

None

44,325

x
!

None

1(1)

16,580

Consumers Power

21,100

2(1)

1(1)
None

None

22,500

3(2)

None

18,000

21,800

:<v

None

4(2)

None

None X

American Power & Light
American Tel. & Tel.12*

Southern Company
Utah Power and Light

5(1)

4,400

Broadway, New York 6, N. Y.

Representative

MARGARET KENNEDY
61

30,100

Electrical Equipment:

ILLINOIS

4(3)

141

10(1)
3

Public Utilities:

None

Squibb
Sterling

Street

Coast Representative

PAUL

None

Gas

Oklahoma

Tennessee Gas Transmission-

Smith, Kline and French

11,100
25,600

2
Pacific

4
'

None

1,300

7,300

Bristol-Myers

4,400

Natural

200

1,000

2(1)
13(3)
2(1)

South

2,172

Gas 11

2,700

Owens-Illinois Glass
Corning Glass Works

Drug Products:

135

12,500

Texas Pacific Coal & Oil

15,898

3(1)

investment

5(2)

Natural Gas:

None

your

Containers and Glass:

America

Prospectus upon

5,150
16,700
A,700
14,500

Standard Oil of Indiana

1,000

Oil

—

Standard

Chemicals:

6,300
12,500

California

800

5(1)

5(3)

20,900

...

2(1)

34.592

Exploration.

Petroleum 1___

Phillips

10(1)

5(2)

1,100

Cement

States

Shell

1(1)

Lead

WASH

<••«

11,700

15,200

Gypsum,

None
WMUIDU

2(2)

17,800
8.000

Crane

None

Star

2,200

None

21,000

Cement

None

SPOKANE AND EASTERN BUILDING
SPOKANE

None

3(3)

2,900

Portland

None

INVESTMENT BONDS 'STOCKS

Louisiana Land &

None

10,000

American Seating

None

16,30-3 V2

Imperial Oil, Ltd

N one

None

X »None

400

None

Radiator

American

28,000

None
None

Oil and

None

Building Construction and Equipment:

Prospectuses May Be Obtained Prom

None

Lockheed Aircraft1

Dome

600

Oil

3,600

■

2,000

American Republics Corp.—_.

9,800

2,000

2(2)

2,100

800

Rayonier

Beverages:

None

Lily Tulip Cup

Petroleum:

3(3)

700

Champion Paper & Fibre 5

2(1)

FUND
mmmmmpmtmmmmmmmm

—

Remington Rand

13,000

3(2)
Aviation:

ill COMPOSITE li

Trusts

Paper and Printing:

Auto Parts:

None

No. of

None

Case—-—.-...-—---.

International

None

Auto and

Caterpillar

1,500

No. of

Office Equipment:

Agricultural Equipment:

RUSSELL, BERG & COMPANY

Sold

—Bought—

No. of

Prospectus from your

which
entirely

buyers exceed sellers—or sellers exceed buyers—by two or more management groups. Issues

which

None

6,000

Credit
4

5,100

None

Illinois

None

Northern States

None

St. Joseph Light and Power

None

West

Power
Power

(Minn.)

4(2)

36,000

2(2)

8,856V>
18,000

Electric

Penn

2(2)

67,800

lowa-Illinois Gas & Electric

;

2(1)
2

Radio and Amusement:

Food Products:

Archer-Daniels-Midland
General Foods
Great Western Sugar
Standard Brands

1,400
22,800
6,600
44,900

18,100

None

2,500

Allis Chalmers

4,400

5(3)

None

Machinery & Chemical
Joy Manufacturing

700

National

Supply

of Canada

2(1)

4,300

2(1)

2,500

4,500
y24,400
9,200
None

3,000
None

^None

Howe

Sound

Hudson Bay Mining.

4(2)

3,900

Southern Pacific

^Smelting

Pittsburgh ConsoKdaltilih' CoalAluminum Co. of America.
ReynoldsJILetqls.
Kentucky Coal.....

West

490
None

None

JNoneX-;. a-None

500

Pacific.

and

2(2)
Kl)

4,500
6,950

5,200

3(3)

4,000

Ohio

3(2)

8(3)

7,700

3(1)

3,500

2,000

2,800

800

20,600
4,900

12,500
2,800
—2,300
19,223.4

5(3)

American

Brake

Shoe....

American Locomotive

Trade:

13,400

None

____

Central

Railroad Equipment:
1

5(2)

—_______

Eagle Plcher

2(1)

Illinois

2(1)

Mining & Smelting
___

40,000
3,300

Baltimore

4,700

..j.

—

Chicago, Rock Island & Pacific

None

Retail

Consolidated

2(2)

Northern

4(2)

Metals and Mining:

1,600

None

3,500

10,900
10,800
11,500

4(1)

2,100'

None

5,200

Food

None

Railroads:

3(1)

Halliburton Oil Well Cementing
National Acme

None

Columbia Broadcasting "A"
Columbia Broadcasting "B"
Twentieth Century-Fox Film—

None

„

Machinery and Industrial Equipment:

45,000
4,000

5,800

1(1)

20,000

Wilson and Co.__
United Fruit

3,500

3(1)

2(1)
Rubber

Allied Stores

—

—;

Green (H. L.) Company—..
Macy
Safeway Stores
Western Auto Supply

Woolworth

and Tires:

3,800

3(1)

None

1,500

3(2)

1,700

None

G'oodyear1

None

——

2(1)

—

3,400

Volume 174

Number 5064

...

The Commercial and Financial Chronicle

Sold

—Bought—

,(1869)

Continued

No. of

from

page

1,000 shares.

No. of

Trusts

5(1)

Bethlehem

593

2
1

1,626.6
12,800

1,000

Kl)

None

Allegheny Ludlum

14,700
27,500

8(1)

Steel

Funds

3(1)
None

Carpenter Steel16
Crucible Steel17

None

1,000

Youngstown Sheet & Tube.

2,000

1(1)

500

Armco Steel

None

2,100

None

Jones and

None

——...

2(1)
3(1)

Textiles:
2

Anderson

1,800

3(2)
2(1)

2,000

Clayton

None

—

M. Lowenstein and

Mills

None

1,000

Mills

Cone

35,300

1
/■
None

None

Sons

900

6(3)

11,500

Robbins

52,050

United Merchants & Mfrs.18—_

10,400

10,300

Celanese

23,000

7(1)

_—.

SUMMARY

Sales Portfolio Securities 60 Investment

Balance Purchases and

Companies

•v

20 ><

Companies

Totals—All

Stock Funds

Closed-End

Balanced Funds

Totals

Matched

Sold

Bought

Open-End Companies:

quarter.

Excluding shares received in two-for-1 split-up or 100% stock dividend.
1,198 shares converted from 4%% preferred issue.
3 Received in three-for-one split-up except 2,700 shares.
4 Purchased through rights except 300 shares. Basis: 1 for 10 original shares.
5 19,600 shares received in 2-for-l split-up.
6 2,700 acquired as result of 2-for-l split-up.
7 Part received in 6-for-l split-up.
8 5,200 shares distributed in 2-for-l
split-up.
^
9 3,548 shares received as dividend from Standard Oil of Indiana.
Basis: 5
shares of Jersey for each 200 of Indiana.
10 13,143 shares received as 5% stock distribution.
11 Part acquired through rights.
...
12 38,546 shares purchased with rights.
Basis: 1 for 10 shaves held.
12a 7,000 shares received from conversion of bonds.
>
13 19,719 acquired with rights.
Basis: 1 new share for 15 originally owned.
14 13.500 shares bought through exercise of rights.
Basis: 1 for 10.
15 17,683 shares added with aid of rights.
Basis: 1 for 6.
16 Received as a 5% stock dividend.
17 136.6 shares distributed as 2%
capital dividend.
18 46,11C shares declared as 10% stock dividend.
*
v
2

companies, but purchases or sales
of funds sponsored by one management group are treated as a unit.
For ex¬
ample, the several companies sponsored by Calvin Bullock are considered as
having the weight of one manager.
Individual portfolio changes of the two
Loomis-Sayles funds are not surveyed.
:
?
'
o
NOTE—This survey covers 62 investment

afnn
M0U

Montgomery Ward Bought

Selling

concentrated in

was

and-Sears Roebuck were fairly
evenly divided, although in total
volume purchases of the former
company were over four
times
sales

1,300 shares. Of- interest
was
an initial purchase of 5,000
shares of Ward by State Street
Investment Corp. and the sale of
5,000

shares of

Sears

during the

period under review. 26,000 shares
of the latter mail order house

still retained.

Opinion

were

evenly

was

Gimbel, which had been

favorites

top
quarter.
Bond

There

was

one

the

bution

Corp.

only

four

tions

desirable
creased

June

shares.

trie

made

American

20%

quarter.

remained

eight

those

from

chases

favorite

while

total of 35,500

funds

15,000 shares

part

Natural

was

purchased
of

total

"D"

holdings of

one

two other

found

two

and
sue

There

2,200

opinion

General

division
Electric

three

months

each

previously.

were

side

Westinghouse,

Cur¬

Gas,

Natural

in Peo-

was

(which

eliminated

portfolios.
Columbia
was
added by one

their

System

the

stock

pur¬

chases of General Electric equal-

boti

Bethlehem the Favorite Steel
quarter,

now

the favorite in

was

the steel group as eight managements added a total of 27,500
shares.
Offsetting decreases in
three portfolios amounting to 2,100
shares was comparatively light,
Five investment

companies gave
preference to Allegheny
Ludlum, portfolio additions totalsecond

ing 14,700 shares.
Youngstown
Sheet and Tube was also,well
thought of as four trusts increased
holdings by 12,800 shares.
Another completely eliminated shares-

from

its

portfolio.

Carpenter

Steel

Additions

resulted

accorded

w*s

iVSln S1u

issues

Robbins

Mills

Port/°J*° additions of

11,500 shares, half of which

rep-

resented

new

5% stock dividend, but three managers added to the shares of Crucible received as a 2% distribution.
Sellers predominated

National

and Armco Steel, three trusts dis-

posing of 4,500 shares of the former and a like number offering
500

the

latter.

shares of Jones and Laughlin

9,000
were

Transacmixed in United States-

were

as during the June quartet,,
although they were considerably
heavier in'^that earlier period.

Opinion

also fairly well di~
Republic, five purchases

was

900

the

commitments.
shares

sold.

was

preceding quarter Robbins had
one purchaser.
Cone

found only
Mills

was

also

well-liked in

trast to the previous

con-

three months'

period when it constituted the lone
issue

which

sellers

ing

33,500 shares

new

predomi-

Another

were

lightened

bought

the stock.

purchases of

sec0nd

holdings

it was during the
Four
a total of 22,80(1

quarter of the year.

funcjs purchased

shares while

One

block
•

from

General Foods was first choice

the textile

by three managements, two mak-

four

American Viscose and Burlington
Mills,

in.its group

...

Preference

the

while

divided

contrasting with four sales.

Issues

nated.

shares.

10,300

about

was

vided

six transactions
market

ion

Steel

investment

pur¬

Westinghouse, the latter is¬
having been heavily bought

rently there
on

was a

selling

Textile

man¬

chasers for its shares in total vol¬
ume

totaling 26,000 shares.

existing
investment com¬

Dumont

amounted

during the previous period, opin*

trust, but two others sold blocks

agement cut down its list by 500
shares.

Corr
poration, 23,000 shares of which
were, lightened in seven portfof
lios. Three contrasting purchases

tions

Gas

the

portfolios; another

Natural

Western

from

and initially introduced into

pany

completely

number of funds

added

were

was concentrated on Celanese

companies liq-

offsetting sale of
issue. 23,900 shares of Square

each

compa-

nies, purchases totaling 1,800 and
2,0.00 shares respectively.' Selling

also sold by two funds.

one

was

Anderv

Lowenstein

uidated 4,100 shares, two of which

acquired 7,000 shares of Motorola.
There

Three

Sylvania, three of which blocks
new
portfolio acqui¬
same

and

might possibly be included in the
general public utility grouping),

constituted

sitions. The

total of 29,600

Northern

concentrated

Four trusts
6,000

pies Gas Light and Coke

s—Sylvania

the

liked

Gas and 1,000 shares of Tennessee
Gas Transmission Co.
The only

Electric and Motorola—were simi¬

preferred

was

Three
Oklahoma

purchases of which
1,300 shares; there
decrease in holdings. Two

6,100

increase

purchased

One block of

c o m p a n

funds

erbocker Fund. The next two most

popular

this

through rights.

Gas,

amounted

sold by Knick¬

was

the

Twenty portfolio

equaled
15,898 shares
offsetting sales totaled

six

managements

shares, two making

initial commitments.

large
receiving stock

only 2,172. American Natural Gas
was added to six portfolios, but a

purchased

managements

pur-

the

distribution

share dividend.

the

issue,

and

through

addition

through

Radio Corporation

the

Gas

holdings

number

de¬

Clayton

SOn

Bethlehem Steel, which had run
Elec- into liquidation during the June,

the second most popular

was

creasing

most

purchases

groups,

by four
equaled 44,000

issue in this group, five trusts in-

con¬

the

such
acquisi-

initial

managements

major

stocks

one

Another sold 10,400 shares.

commit-

three

decreases

were

ments;

Popular

equipment

exclu-

stimulated
electrical

executed

were

sively through the use
rights. Included among

Despite the fact that radio and
tinued

gas

rights. Of 13 portfolio
totaling -33,216 shares,

purchases

this issue
had found two purchasers in the
previous three months' period.
Radio

industry,
Corporation was the

Gas

ing due allowance for acquisition
of stock stimulated by the distri-

second

natural

favorite company, even after mak-

although

Stores,

the

activity in, additions

three months' period.

TRUST FUND

set off

were

6S amounting t0 were each bought by two

shares.

United

particular issue of this group. As
during the previous period, trans¬
actions in both Montgomery Ward

larly

LEXINGTON

three trusts also made purchases.

the

FOOTNOTES

i„OAn

ling 17,200 shares

divided between two managements

Companies-_

chants and Manufacturers resulted
stock dividend, but

from the 10%

Balance

of the last two issues in the

second

3(1)

4,500

Laughlin

Buy

There had been three purchases of
each

9,000

National Steel

A large part of the
holdings in United Mer¬

increased

Steels:

most

second

trusts liquidated.

popular
..

issue

was
.

nAr,

Standard Brands, 44,900 shares of
which were added to three portHere, however, there was

folios.
one

fairly sizabie block of 20,00(1

shareg

sold#

ments

were

Tw0

initial commit.

made in Archer-Dan-

ieis_Mi;(jianc| equaling 1,400 shares,
misQn and Co

gugar
^WQ

and Qreat Westem

a]s0

were

each bought by

managements.

concentrated

Selling

was

United Fruit

(as

mentioned earlier), five trusts dis¬

posing

HOWE PLAN FUND,

4,400

INC.

three of

shares,

Continued

page

Prospectus and Latest

Quarterly Report
Your

Prospectus may be

obtained from
Office

from,

Dealer

George D. B. Bonbright
Members

the Fund's New York

Investment

;

New

York

Stock

and

Co.

Exchange

Guardian

Rochester, N. Y.

Mutual

General DUtributor

from

or
.

•

v.-

•

—
-*

}
''

.'r

'•

■

Fund
Mutual Investment Funds

Ira Haupt & Co.

Members New York Stock Exchange, New York Curb Exchange
and other

principal exchanges
the

111

Broadway, New York

republic

axe-houghton

N. Y.

investors

funds

fund,

Investment Dealer

Neuberger & Derm an
MEMBERS NEW YORK STOCK

AXE

SECURITIES CORPORATION

730 Fifth

Avenue, New York 19, N. Y.
•1

EXCHANGE

inc

160

■

Broadway, New York 38

Phone: COrtlandt 7-2600

The Commercial and Financial Chronicle

jrom page 33

inations.

completely eliminated the
from their holdings.

which
stock

vWv

distributed

com¬

total of 14,500

bought a

panies

11,000
shares of Squibb, 18,225 shares of
Colgate-Palmolive-Peet and 2,700
shares of Merck. Additions of the
latter
company
do not include
178,400
shares received in the
Bristol-Myers,

three-for-one

25,-

stock split-up.

of Sterling Drug were

600 shares

added to two

portfolios and 4,400

Kline and French
purchased by a like number
of managements. Two trusts also
added shares of Pfizer in addition
to those acquired through the ex¬
shares of Smith,

were

ercise of rights.

In all, seven com¬

panies bought '20,070 shares. Sell¬
ing predominated in Procter and
Gamble and Sharp and Dohme.
Buying in the automobile issues

topped by Studebaker, six
managements - adding
28,000

was

shares, two of which made ini¬
tial commitments; there were no
sales. Interest was also shown in

Chrysler by five funds, purchases
totaling 3,000 shares. However,
stock was lightened in one port¬
folio
and
eliminated from two

with

Sellers

commitments.

new

ascendant

the

company

represented;

and

50,200

equalled
on

former

the

added

were

General

Motors, although liquidation was
comparatively light. Four man¬
agements disposed of 4,100 shares,
but
offsetting
purchases
were

others totaling 4,900.
Also
sold, each by two trusts,
were
Borg Warner and KelseyHays Wheel "B."
made by two

2,200

Vacuum, which during
period had been the most

that

popular issue, was now being subjected to profit-taking as three
managements lightened commitments and two others eliminated
it

from

However,

their holdings.

three trusts still favored this stock

purchases
totaling
27,100
shares. Three Standard oil issues
with

—California, Indiana and Ohio—
sold by four funds.
California totaled 5,150;

each

were

16,306M> shares about doubled the
overall volume of four purchases,

ernun
group, each being bought hv three
eacn oeing Dougnt oy tnree

ul
of

acquisitions

Total

managements.

9,800 a"diCS. of Anderson Prishares
^
initial commit*,ouu

chard represented

in
while two of those
Republics were new
portfolio holdings. One trust elim¬
inated a block of 2,000 shares of

ments,

terest
cial

3,300
was

was

indicated in Commer¬

Credit

by two purchases of
shares. However, opinion
almost exactly divided be¬

tween four funds

C.I.T. Finan¬

400

while

this latter

issue.

Oil

Humble

and

Standard of Kentucky each found
favor
with
two
managements.
Transactions

Service,

mixed

were

Pure

Oil

Sinclair.

and

also

was

Cities

well

fairly

Mid-Continent Petro-

tions to portfohos

existing

2,000

sented
ments.

tial commitments.

Union
cal

Carbide

issue

Foiir

offsetting purchases tallied

only

800

eliminated

DuPont

two

from

stock from theit

totaled 12 soo shares.

and

D
?

man-

Fidelity and Guaranty.

offsetting were two sales tallying 3,200 shares. Also favored as a
particular

growth

specialty

was

November, 1950.
came

Spencer
The

selling

concentrated

tion

and

sellers

also

of
on

oil

stocks

Texas

was

Chemical,

two,

man-

agements

Selling of Oils

■■

increasing

their

hold-

ings by 6,000 shares.

Corpora¬

Phillips
Petroleum,
having predominated

Building

Sold

Maynard
Proctor

Star

Cement

and

United

States

vious quarterly period. Ten man¬

popular among building stocks

sold

14,500

shares,

completely eliminating the

one

stock

from its portfolio. Ten investment
drill

Gypsum

were

the

least
as

five funds sold 7,700 of the former

issue and

8,000 of the latter.

each instance two of the sales rep-

Selling

sold

Island

New

Paine,

and

evenly

Chester

Ivison,

Abbott,

135 S. LaSalle Street,

D.Tripp
President

November 8, 1951

Chicago 3, Illinois

Laidlaw

Co.,

New

Siood Stneet

Inverting
(ZoxflMAtiOK

Webber,

Jackson

INVESTMENT

ver.

■

Prospectus oh Request

Broad Street

Co.,

Den-

Sales

General Distributor

ing terms are: *

stocks

were

between

Bache, Bache & Co.,
New York; Henry I.
Cobb, Jr.,
DeCoppet & Doremus, New York;
Edmond du Pont, Francis I. »du

the
pur¬

Corporation

vary¬

Governors

COMPANY^

Cur¬

re-elected for

Sullivaq

Bosworthj

DIVERSIFIED

White, Weld &

Starr, Jr., Drexel & Co.,
Philadelphia; John
J. Sullivan,

funds.

Governors

Harold

printing

balanced

16,1951.

ward

and Southern,

paper

distribution of ap¬

shareholders of record November

securities

proximately 45c per share from
realized capital gain, both
payable November 27, 1951 to

net

tis, New York; William M. Meehan, M., J. Meehan & Co., New
York; Frederick R. Rogers, Thom¬
son & McKinnon, New York; Ed¬

concen-

transactions

15c per share from net investment
income and

Co., New York; Lloyd W. Mason,

Opinion was divided on Santa Fe.
Great Northern, Canadian Pacific

Overall

Television-

approximately

elected, to the
Board of 35, at the Annual Meet¬
ing of members of the Association
were:
John E. Blunt, 3rd, Blunt,
Ellis & Simmons, Chicago; Marco
F. Hellman, J. Barth & Co., San
Francisco; Edward H. Hilliard,* J.
J. B. Hiliiard & Son, Louisville;

were

two

board

York, Treasurer.

Pacific, eight

Directors

Electronics Fund, Inc. have author¬
ized payment of

Paine, New York, and

Deventer,

reducing holdings by
6,950 shares. Half as many trusts,
however, made purchases totaling
3,900 shares. Baltimore and Ohio
was

has

The

Ouorterly Dividend

Phelps Witter, Dean Witter & Co.,

was

ihc'

12 th

Los Angeles, were elected VicePresidents and William F. Van

rails, experithe preceding quar-

Southern

tsburgh,

the

s8?j
°*d.

Scribner,

career

business.

companies

also

Lone

in the Texas issue during the pre¬

agements

list.

Mr. Maynard be¬

member

entire

to three portfolios. Another management eliminated this rail from
trated

1949; except for three war years
in the Air Force he has spent his

subsided
somewhat
with
fairly well divided on
either side of the market. Illinois

its

President of the Association since

were
distributed throughout the each
bought by four funds.
PurCorp., purchases of 2,500
group with transactions mixed and chases of the former totaled 10,shares contrasting with sales of
opinion divided on such issues as g00 and of the latter 10,900, There
3,000. A few casualty, indemnity
and
fire
and
companies were pur¬ Dojvwas Monsanto. Allied Chem- were two offsetting sales in each
ical
the favorite among buy- issue. Northern
Pacific, whch had
chased
by
two
managements. ers as it
was during the second
been the favorite in the preceding
These included American Surety,
E. Jansen Hunt,
quarter of the year.
Five pur- three months' period, was added
Continental Casualty, Firemen's

chase?, amounted to 7,700 shares;

suc-

served

Metals

cial

Insurance of Newark, the General
Reinsurance Corp. arid the U. S.

who

Walter Maynard

Subsides

Rock

the

Singer,

Pi t

lone sale of 200.

and

Main
Boston

Co., 332

York

senior partner
of

transactions

Central

members
Stock Exchange.

Joseph
Scribner,

M.
-

ter>

Other sales

Hanrahan

Street,

Annual

City.

of Ana¬
5,000 shares were

The selling of the
o
enced during

Mass. — David
associated

become

ceeds

purchases

Selling

Rails

has

Miller

Chronicle)

to The Financial

WORCESTER,
with

year

Meeting

divided
in
Kennecott,
and International

totaling

With Hanrahan & Co.
(Special

Firms

Board

.New

Dodge
Two

Chronicle)

Financial

Building, rrrembers of the Detroit

its

tucky

evenly
ph^ps

The

Stock Exchange.

fiscal

Eagle Picher and West KenCoal. Transactions were

ley Higbie, 3rd is now with
Bradley Higbie & Co., Guardian

of
New

Co.,

change

disposed of shares

each

iwo

(Special

for the 1951-52

Sales

Three

With Bradley Higbie
.v;

was elected President
Association of Stock Ex¬

Sound was

Reynolds

sold

agements

ing of the securities business.

City,

the

Smelt¬

portf0lios.

public understand¬

better

partner

Hammill

heavily sold issue in the group,
two companies reducing holdings
and three others eliminating the

and

another, volume

Maynard,

'
by two funds. Alumi¬
America was the most

was

portfolios

totaling 1,500 shares.

York

chemi¬

generally sold as
six trusts disposed of 7,200 shares.
shares.

Walter

Shearson,

liked

num

most

lightened

1>6C0.'Howe

more effi¬
services and to

public

the

investment
a

trade associa¬
help its mem¬

DETROIT, Mich.—Nathan Brad¬

Exchange Firms Elect
Maynard President

Purchases of the
and,of

ing of Canada.

offset by one

the

was

and

give

cient

foster

commit¬

Governors

Mining

bers

former tallied 4,500 shares

conda

Chemical Mixed

portfolio

new

uired^Hud-

28,-

equipped

the

provide

1913

tion

Three ok these repre¬

Thve*
™•
{c "Lu;n<f ™a
son Bay Mining and Smelting and
Mining
nnH
Smeit-

Worthy
totaling

« hal™r

also

Joy

four purchases

Distillers

ments acquiring a total of 24,400
shares. During the June quarter

Consolidated

and

machinery

Acme.

were

900 shares.

ings were doubled as a result of
the stock split-up.
Opinion was
divided on United Aircraft and

Nickel.

represented ini-

also

National

sharehold¬

totaled

Lockheed

chases

Chalmers

outstanding

National

note

number disposed of 5,shares of Bendix.
Two pur¬

same

American

two

and

16,700;

Indiana,

leum, although three of the addi-

favored

Del.;

■

issues sold, while buyers favored
Halliburton Oil Well Cementing

Apathy continued to exist in the
aviation stocks with selling still
predominant. Three^managernents
of Boeing and
sold 3,600 shares
™

the

were
,

Douglas. Worthy of note was the
almost complete lack of activity
and of Ohio,
on either side of the market in the
4,700. Texas Pacific Coal and Oil
air transportation issues.
was lightened in three portfolios.
Among non-ferrous metals PittsProfit-taking also overshadowed
new
acquisitions of Standard of burgh Consolidation Coal was the
New
Jersey. Ten sales totaling most popular stock, Jour manageSales

among

also

AnniUxr

A"athy Toward Avia"ons

Socony

Choice

was

Wilmington,

received

Allis

stocks.

this stock.

siderable liquidation in

Opinion

Trust

Co.,

Lily Tulip Cup.

stock

divided

funds bought 4,400 shares. Among
the finance companies some in¬

offset- vorite in the group was American
shares Radiator, four trusts adding a
initial com- total of 28,000 shares. Also liked
mitments. A total of 34,592 shares by four managers were General
of Louisiana Land and Explora- Portland
Cement and Glidden.
Crown Zellerbach.
tion was disposed of by five funds, Three
purchases of the'4 latter
change Firms is a trade body for
Other than three purchases of
members and member firms of the';
three of which cleared the decks i stock represented initial commitGoodyear totaling 1,700 shares, New York Stock Exchange. It is a
of the issue entirely. In the June ments.
American Seating was
opinion was divided on the rubber
voluntary organization formed in
quarter there had also been con- added to three portfolios,
purchases of
which
represented

Banks and Finance Companies

the bank stocks
was Guaranty Trust of New York,
three
managements acquiring a
total of 1,500 shares; there were
no
sales., Chemical
Bank
and

tion

split-up, there were three

Anderson-Prichard, Atlantic Reand
American Republics
others. Nash-Kelvinator and Bohn fining
were the best liked stocks in this
Aluminum and Brass were each
bought by two companies. Shares

Pont

Eugene M. Geddes, Clark, Dodge
& Co., New York; James Parker

In addi¬ Nolan, Folger, Nolan & Co., Wash¬
a twoington, D. C.; Walter S. Robert¬
for-one split-up, there was an in¬ son, Scott & Stringfellow, Rich¬
itial commitment of 20,000 shares mond, Va.
v
V
in
Following
the
organizational
Champion Paper and Fibre.
Sellers
predominated
in
Kim- meeting of the Board, Mr. Scrib¬
berly Clark as three portfolios ner and the retiring Governors
were
lightened by 2,100 shares. were guests at a dinner in their
Dixie Cup was completely elim¬ honor,
attended by many past
inated
by
two
managements. Presidents and Governors of the
Transactions were evenly matched Association.
in both International Paper and
The Association
of Stock Ex¬
shares of

lightened in four portfolios
again no interest shown in

companies also decreased holdings purchases. Crane was disposed of
of Phillips by a total of 20,900 by three managements and Nashares.
In addition to new stock tional Lead and York Corporation
distributed
in
the
two-for-one were each sold by two others. Fa-

several ting

among

investment

Three

issues.

••

drug„ products

the

Interest
was

' v

Drugs

also

funds

Three

sales.

and

bought 13,000 shares of Rayonier
and a like number added 4,600

purchases of either stock.
15,200
shares of National Gypsum were

Balance

Funds Buy on

chases

complete portfolio elim¬
There were no offsetting

resented

Continued

Thursday, November 15, 1951

...

(1870)

Broadway

•

New York6,N.Y.

Tb,

GROWTH

FIDELITY

A Mutual Fund

INDUSTRY

Founded at

FUND,
Boston,

INC.

1930

Prospectus and Other Data Obtainable From

General Distributors

Priced at 103% of net asset value;

SHARESy

inc.
A Prospectus
Prospectus from

your

dealer

The

Pan! H.Davis &6o.

BOSTON, MASSACHUSETTS

CHICAGO, ILLINOIS

Teletype BS 411

Teletype CG 934, 405

HARLAND ALLEN ASSOCIATES

Telephone FI 6-0300

28 EAST JACKSON BOULEVARD—CHICAGO
4, ILLINOIS

52BBC5525S

Crosby Corporation

pany

the

describing the Com¬

its

shares, including

price and terms of offer¬

ing, is

available

upon

request.

Telephone CA 7-6811
>VV—W"

EBERSTADT & CO. INC.
39

ati

and

Broadway

New York City

Number 5064

Volume 174

(1871)

Financial1 Chronicle v

The Commercial and

(3)
Continued

For

June

from page 2

fiscal year ended

the

30, 1951, the common stock

earned about 80 cents

prior

The
trailers

for transconti¬
Halliburton Oil
Cementing Company is ofte
equipment

FWD

Well

large industrial organi¬
sations that have standardized on

2y8

New York

American

Latin

share after

it^ is selling at slightly over

2V2 times earnings.1'-•

kOGGENBURG

Roggenburg

Partner,

hauling.

nental

STANLEY L.

powered

being

are

and current pre¬
dividend requirements. At

charges

ferred

Security I Like Best

The

(4)

(/o.,

Countries

volume

is now in
industry in point

twist

drill

sales

There

asm

against 17th 11 years ago.

Railroad

Canadian Pacific

company

third place in the

City

enthuji-

considerable

among

investors

been hailed in many

have

quar-

everY

the ters as the most important

over

many

My favcjrite securities are oblicompletely gations of the Latin American
equipped with more than 600. Countries which in the last 10
FWD units. The company is cur- yearg have Refunded their external
i„rnirnnt
imnnrtant.
rently turning out an important debts at yields
transportation unit forjthe United ranging from

and

trucks,

FWD

J.VJL y

•' (5) The company's principal
products, high-speed twist drills,
are known as perishable tools,
because they wear out in propor-

Military pro-

States Government.

4%% to 7Vk%.

duct^ion presently accounts lor ap- There are citproximately one-third of the ies and states
company's current backlog .and ofErazil which
production^
Wheel

Four

Com-

Auto

Drive

has been in business since
1909. A purchaser of one share at
that time now holds ninety shares

pany

splitwhich have occurred since.

through stock dividends and
ups

While

look at the company's div-

record

idend

that

over

period

bonds

it should be

company's business,

rioted that in the more prosperous

1 qp, a

3%'
.

wa\ J
bia
has.

de-

partment

peacetime business.
in the

future

received a 10-year loan
.
.
•
$1,500,000 from certain uisurance
companies, '; containing
the

jg,

which freeze

provisions

of
Canada's

Canadian

Long Island Lighting

Pacific

substantial

selling Products

orders for

Avildsen s

their

transition

when

span

Its rail lines

the entire Dominion, serving

major city in Canada and
an 0f 'the important industrial, ag-

every

Preferred Stock Sold

thereby

shares
Co.

Island Lighting
stock, 5.25% series
($100 per share) and

Long

preferred
at

par

accrued

The

dividends.

offering

oversubscribed and the books

was

ricultural timber and mining cpp- closed.
Hons. Thus, as its raiboad
Net
proceeds to be received
ness constitutes a complete cross- from the sale of the preferred
section of the country's economic shares
together
with
proceeds
life, it can not help but participate from the sale of additional bonds
fully in any long-term economic will be used to retire $14,493,400

bust

growth.

Its transportation activi-

several new district ties also include extensive air

affording a yield of managers and a number of new routes, and trans-Atlantic, transapproximately 7% or better.
:
;
sales engineers.
Pacific and coastal steamship servIn the case of each of the foreAvildsen has expended close to ices. It has extensive rail holdings

us u a

production are expected to place system in the world.

Roggenburg

$200, and selling between 8% and appointed

find

bonds programs have been completed.
that followed each low around 44.>
point in the cycle, the company which go to 2y2% in 1953, selling This additional buying should be
has paid dividends to make up for at 34.
at 34.
-xieflected - ;|n a corresponding inthe lapsed years on an average
In Central America there are crease in net earnings for Avildbasis of 6% on its $10 par value. Salvador bonds which pay 31/2% sen.
The company has been alert to
After each stock dividend or split, and sell around 62 Mj. Mexico has
the 6% rate has been maintained
oonds which are payable at ma- the
necessity of expanding its
an
the new shares.
In 1947 the turity between 1963 and 1968 for sales and service staff and has
company

These bulls

picture.

HH9H9HI &JS? customers who have suf- iargest and most comprehensive
?
"
fered £om cutbacks on civilian priVately owned transportation

paying
3% .
Peru has 2%

years

the company's stock a comprehensive medium for
products became effective in Sep- participating in this future,
tember.
Furthermore, a number
Canadian Pacific Railroad is the

and

bonds

city

ai„

aspect

and

An increase of about 5%

selling

which have as

arP

imnleXtf and °f the °pinion in store for the Do- been $L75 a share> payable in
that Sreater indus" Canadian funds. In the preceding
trialization is

farm

selling x price

at 39 which

and then be¬
of the cyclical nature of the

tnni<=

i«Vn thp\,n,^np n^fitivJn minion over the intermediate fu- six years the rate had been $1.25
^ thlUn^U? P°SLt1^ ture- Likely population growth is annually,
able to benefit from botn another favorable aspect of the

war

Chile

has

tItpsp

m-ripr*

of being

and 50.

rruin assures
This

potentialities are viewed as virtually limitless. At recent market
potentialities of prices it is pointed-out that Canayet barely been dian Pacific stocks reflect little,

scratched. Along with the strong if any, value m the petroleum
used for aim-aft
trurks trartnrs
Probability that these natural re- rights. In the meantime, the stock
tanks
let
eScines electronics S0Urces wil1 nOW be more inten" affords an attractive income reguided missiles electriceauinment' slvely exPloited> most people are turn. Distributions this year have

between

„„„„„
usage.

fhprpflhrp

selling

2V2%

indicates lapses now
cause

from

their

to
^

rpnpat

machinSv^

paying

are

tion

J1,?"110 ?u0W/J. °I otfr neighbor to
north. Canada is rich in nat-

bonds

former

subsidiaries,

, .
,.
^ * e * n outstanding
bank_ loans, to complete the financinS of 1951 construction, ana
to furnish approximately $2,000,000 towardthe construction pro¬
1952 construction. To
complete
„

and permit dividends to going issues, anywhere from 20% $500,000 in the last fiscal year in the United States. Corollary
be
new
production machinery services include hotels, andv expaid only from subsequent to 50% of the amount "of the bonds for
earnings.
In 1948 and 1949 the originally issued have been re- which has enabled the company press, telegraph and cable netgram through 1954, it is estimated
beavy truck industry faced recon¬ tired, and the chance of principal to improve the quality -of its works.
that
the • company ' will
require
version problems and losses were enhancement is very good.
tools and reduce manui'actur- . Railroad operations by them- approximately $100,000,000 in ad¬
sjhown by this company and many
With world conditions as they ing
costs.
$290,000
of
this selves have consistently been prof- dition to funds expected to be
has
already
been cov- itable. Year
by - year they have
others in the industry. Dividends, are, Latin American countries will amount
provided by depreciation accruals,
therefore, have not been paid be about the only place that bene¬ ered by a Certificate of N'eces- been sufficient to more than cover
charges.
Moreover, these retained earnings and presently
since 1948, but current earnings fits from present troubled condi- sity, permitting accelerated depre- fixed

surplus

suggest an early resumption of
dividends since all deficits have

countries ciation of about 85% of this
re- ^amount.
It is anticipated that
"...
Certificates of Necessity for the
being written Chile balance will be authorized as soon

tions, and some of these
tremendous

have

been repaired, and the com¬
pany's management considers that

now

sources.

this

natural

charges have been pared sharply
over the past 10 to 15 years. They
now total roughly $13.5 million
compared with a peak of nearly

h,au ? m01;al obllfatian ,to lts 21/2S~ Peru 2s and Brazil 3%s have as applications have been proc- $37 million in

contemplated financing,
Long Island Lighting Co. is an
operating public utility, princiPally engaged in the business of

l938rRaVlroad earn- producing, transmitting, distriband

essed by the authorities in Wash- ings last year amounted to $38 uting and selling electricity
are rumors the Peru Plan will be
ington. In addition to large quan- million after taxes but before manufactured or reformed natural
improved, thus proving that these tities of products being sold di- fixed charges. On an overall basis gas. The company
Four Wheel Drive Auto-Comcountries are not only in position rectly to the Air Force, the Army net income after taxes and charges competition with any privately or
pany
is listed on the Midwest t0 meet present debt requirements and the Navy, a substantial por- last year came to $48 million, publicly owned
or gas
Stock Exchange.
It is currently but could improve them if they so tion of the company's current pro- equivalent to $3.32 a share on the utility company or agency
selling at 8, having sold as high as wished.
duction is being shipped to de- stock. Some improvement over ing similar services in
18 in 1946, and as low as 4 in 1949,
To me a package purchase
Tn mp a narka^p nurchase of the fense industries. For that reason this showing is anticipated in the torv served bv it.
The
tory
by
while the industry was showing various securities would give the it enjoys a high priority rating for current year.
area of the company cove1*;
losses. On June 30, 1951, net cur¬ buyer a good return and also a the procurement of steel and supCanadian Pacific does not rely approximately 1,200 square milf
rent assets were $18.01 per share, great chance of principal appre- plies.
entirely on its transportation ac- wholly within the boundaries c
or
$15.03 after deducting long- ciation within the next few years, ^Long-term debt now amounts to tivities and allied services.-; It has xTocca
__ A
pn,infipc an *
term debt; net depreciated book
regardless
of
world conditions $571,666 as compared with $741,- substantial outside interests. For
1

stocknolaers to pay dividends ag-

made

new

all-time highs and there

the three
lapsed yeais as soon as possible.
$1.80

gregating

for

is not in direct

electric

renderthe terrifranchis

value.

S20.89

trinsic value,

and incurrent

share;

per

based on a

JAMES

appraisal of the company's prop¬
erty for insurance purposes, was

share. Sales for the
fiscal year ending June 30, 1950,
were
$7,600,000; June 30, 1951,
$18,000,000, and current produc¬
tion schedules indicate that sales
will approach $36,000,000 for the
year to end June 30, 1952. After
a loss of
$1.09 per share for the
$31.08

fiscal

1950

the

year,

Tools and
company

base

per

share.

nent

$2.50

below will
dicate
believe

believe

considerably

was
0n

James H. Young

8, near its low of

.value frequently

and can be ex-

-pected to do so again. Its earning.
power is high and the company
"should enjoy one of the most suecessful years in its history during
the current year. The broadening
of its markets should bring a continuation of high earnings.

Firm Name Is Now

equivalent to $20.60 a share

the 13,400,000 shares of Cana-

Barmonde, Gilliland Co.

authorized the

the

company

directors to a share on its own stock.
debt of
Potentially a
factorSof

long-term

these

and to provide for greater importance is the possibility of substantial oil earnings
in the not too distant future. At

■!"

ment.

who makerthe

firm"'

„

Ullca office, and Philip 1. oar-

: in¬

monde.

year.

will permit the payment of a sub- title to petroleum rights underthe year end- stantial proportion of the arrearlying 11,328,485 acres of land in
ed
June
30, age on the prior preferred during the Prairie Provinces.
Of this
1951.
were
1952.
land, 42,743 acres were under lease

(2) Net earnings of $405,064 for
the last fiscal year are equal to
$2.11 a share on the 5% cumulative prior preferred (par value
$5), or more than eight times the
regular annual dividend require-

Gilliland

hAart'

pansion of sales volume during

are

creasing.

Robert

even

(1) Sales for

this

currently

P°Pulation of the territory serve,

is approximately 1,100,000.

has. pre- market value of $275,930,000. This

selling
the year, hav¬
$9,323,097 against $4,563,788 a year
With a current price of 3% for to oil companies and the balance
ing sold as high as 9% earlier.
earlier./Sales are now running at the prior preferred and 2V8 -for was under reservation for explor-In the past, the company's market
.value has approached its intrinsic about $1,000,000 a month and in- the common, I believe a package ation.
valued;

,mt

Clty °f.

the the end of last year the company
According to the annual re- had direct land holdings of 1,583,purchases at port just released, the company 549 acres which it is selling off
this time:
anticipates that this refinancing gradually.
In addition, it held

under¬

Count:*

(the Rockaway peninsula) in tb'
of
atpw
York
Estimated

ri-fv

additional working capital necessary due to the considerable ex-

interesting

1951.
be

1951.

refinance

in-

why

securities

maturing $150,000 per
amounting to $887,647 on

perti-

facts

enumerated

Summarizing,

•stock

Machines,

The

placed,

jJune 30,

requirements which

levels this investment alone had a

NassaU>and Su of Queens
folk c
the Fifth Ward

dian Pacific stock outstanding,
The firm name of R. M. Gilli¬
Consolidated Mining & Smelting
has increased
its dividend to land Company, 52 Wall Street,
company is now working on a re- $10.50 in 1951 from $8.50 paid in New York
City, has been changed
financing plan which will remove 1950.
Dividend income to Canathis working capital restriction, dian Pacific this year from this to Barmonde, Gilliland & Comand the stockholders on Sept. 18, source will be equivalent to $1.32 pany. Principals of the firm are

Inc.

Capitalization consists solely of
300,000 common shares, $10 par,
and
Jong-term
debt privately
iyear,

tal

capi-

whose

and

Excess profits

Machines, Inc.

Avildsen Tools

company

approximately

-tax

YOUNG

securities vented the company from paying
I like best at this time are the preferred dividends. The accumu5% prior preferred, as an invest- lations amounted to 62 V2 cents a
ment, and the common stock, as a share on the prior preferred as
speculation, of of Sept. 30, 1951. However, the
The

profit of $1.32 per share
in the 1951 fiscal year, virtually
all of which was earned in the
months.

year ago.

vision for minimum working

Avildsen

final four

of the company,

President, J. II. Young & Co. hie.,
New York City

per

showed

The mortgage note one thing, it owns 51% of the
held by the Mu- stock (1,682,500 shares) of the
tual Life Insurance Company of leading mining and smelting conNew York, amounted to $650,000 Cern in CanadS, Consolidated Minon June 30,
1951, and has a pro- jng & Smelting. At recent market

705

generally"

combination of the two issues represents an interesting purchase at
this time and holds possibilities
for realization of a good income
on the preferred and anticipated
growth in the value of the common as the accumulations on the
preferred are paid.

To date income from this source
has not been important. Last year
income from petroleum rents, royalties and reservation fees amounted to $1,900,000, up $254,000 from
the preceding year. Eventually
this could become very substantial. Oil discoveries in the area

Specialists in

RAILROAD

SECURITIES
Selected Situations at

25 Broad Street

New York 4, N.
Green 9-6400

Telephone BOwling
Members Nad Assn.

all Times

Y.
_

Securities Dealers, Inc.

The Commercial
t

and Financial Chronicle

Thursday, November 15, 1951

...

(1872)
However,

made.

Continued from page

not

appear

is more likely
look to the savings institutions
The Treasury

Problems

Investment

large.
Prices should

very

be fairly steady
circumstances and the
living index is not expected

*jnder these
cost of

much as 5%. The

to rise as

rise in

is likely to
Le persistent and in excess of any
increases in living costs. With a
neater proportion of defense busiloess and with wage increases not
Xuilv offset by price increases, the
saueeze
on profit
margins will
Snue. On the other hand, it
<ices not seem likely that .profits ever,
a different situation^
Twill be curtailed further by new prevail because of the
tax legislation.
This adds up to for financing the
rates, however,

wase

.aggregate corporate profits after.)
taxes at about present levels but
•well down from the peaks of late
nnd ^ariv

deficit.

Long-Term Interest

this vear

and early.
year.
abbreviated sketch o
•economic outlook may not meet
with the endorsement of f
of you; certainly it does not bear
too close a resemblance to tn
jpicture which some goveinm
•
last year

will
necessity
substantial cash

It is

Rates

*
considerably more difficult

appraise the trends

affecting
The

long-term interest rates.
he
demand for corporate

This

funds

balance

indeterminate size.
while it seems reasonable to asofficials have be®*1 ^reSu? ill? «L ' sumethat net new corporate sejseveral months. No doubt my ap- CUrity issues will be only about
praisal will prove inaccurate m ^ billion greater in 1952 than in
certain respects, yet we are
^
qujte uncertain
©bliged to start somewhere if we wbether the rate of net increase in
wte t6 succeed m
f
^ real estate mortgages will be down
with specific investment problei
. ^ billion or $3 billion or more

the

any

pri¬

sum while obtaining
from
the
commercial

buying

stop

dividends

threatened or if yield
proves

are

experience

Implications for Investment Policy

presumption that the

between corporates and
governments might widen during
the
next few months and then
narrow
again after the peak of

erately restrictive
bank credit.

spread

For

the

kind

public

Yields

question of yield spreads
quite naturally into the sec¬

ond phase of our discussion, which
relates to the position of common

if is argued, prevent

can,

develop¬

that

inflation and

continuous

face

outlook

longer-term

about

another supposition

Still
the

depreciation in the value
as
a
result of fiscal
measures, wages policy, and un¬

further
of

money

qualified devotion to the goal of
full employment.
In this view,

opportunities
to

sup¬

maintaining economic stability.

long-term in¬

available

price

postwar recessions or depressions
of the past, is cited as evidence of
how much we have learned about

the

principal investment problem
maintain as much purchas¬

ing.;: power

acquire

corporate bonds and sound mort¬

loans during this period of
demand for funds.
The
market for state and municipal

im¬

secondary

portance since debts can be set¬
tled in dollars of declining real
This line of argument em- '

value.

phasizes where we may be in ten
or twenty years if the price trends
of the last decade continue.
'\:C
The

gage

heavy

Credit

possible.

become

risks

favorable

in the field of

Farm

ing. The inventory correction of
1949, in contrast to the severe

vesting outside of the bank port¬
where liquidity is
not a

factor,

con¬

as a power¬

serious deflation from

mod¬

influence

goods.

measures

folio

should
leads

backlog

ports, social security, and similar

exercising

tivated toward

guaran¬

a lagging demand
housing. The tre¬

ful sustaining force

pause

Common Stock

residental

should capital

;

The

boost

tees can
for

mendous

to reflect upon the preced¬
Any of these possibilities, from ing discussion in order to consider
which it is difficult to select the some of the implications for in¬
most
likely at this, early date, vestment policy.
v
v
would suggest fairly steady gov¬
If we are entitled to look for
ernment security prices.
Essen¬ a fairly firm money market in the
tially what we face is probably a months ahead, the emphasis in
period of substantial borrowing, bank portfolio management
from the commercial banks. This should
be upon having
enough
suggests that there Will be some short maturities to provide liquid¬
easing of their positions whether
ity.
Having established an ade¬
to
facilitate the direct sale
to
quate short position for this pur¬
them of short-term securities or
pose,
it will be appropriate to
to permit them to purchase newly
think about longer maturities for
eligible issues from the savings income as evidence begins to ac¬
institutions who would then re¬
cumulate that the peak loan de¬
place the bonds sold with new mand has passed and that the
long-term issues.
,
Federal Reserve is no longer mo¬

somewhat

that easy terms and

and

unsatisfactory.

Perhaps at this point we

the

sector

struction is mentioned

banking system.

There is a

goods

The point is made that
the relaxation of credit controls
will stimulate consumer
buying
economy.

impetus to this buying comes
the search for a better rate
return,
these investors may

durable

the

profit position

In fact, since the

from

will be supplemented by a volume
private demand has passed.
0f reai estate mortgage financing
^

mary

to
if

the

quired

reasonable to assume
that the Federal Reserve will
keep , a tight rein on any expansion in bank credit. Since the
Treasury's financing problem will
not be a major factor m the
months ahead, except for the April
1 refunding operation, we might
assume that the Federal Reserve
will permit the market forces at
work to keep money tight and
short-term rates firm for considerable periods between now; and
next June After mid-year, how,

savings sue. It seems

individual

keep

of business.

free funds at the
time, and if not, to borrow from
corporations for part of the re¬
they have

In Current Economy
should

terioration

the basis of

to date, this does
likely to happen.

developments

perplexing fact is that each
'long-range forecasts,—

these

deflation, stability at a high level,
and inflation,—has a strong ele¬

these bonds should be subject to most
market of the same influences, with the ment of validity, but they cannot
all be right at the same time and
does not seem particularly likely
supply factor of greatest impor¬
we do not know how to arrange
when the trend of profits is flat
tance.
Some buying of taxShort-Term Interest Rates
from this year's total. The volume or moderately downward. Never¬ exempt bonds is likely to result them in sequence. Just to add to
pt,nrf
of new state and municipal fitheless, the rate of return pro¬ from the taxation of mutual sav¬ the confusion, I should like to
actors atfecbng
nancing> inciuding public housing
mention a fourth possibility, one
vided
by
good quality stocks
ings banks but it will probably
^ nninf for onr analysis bonds, is not likely to show much showing adequate protection for be in moderate amounts over the which is not nearly as widely ac¬
parting point
..
have change. On the whole, therefore, dividends exerts a strong attrac¬ immediate future.
cepted. This is a cross between
the first and second forecasts. Ifc
tiStv at a ranid the demand for long-term capital tion for capital free to go into
While
good quality preferred is the
Whpn war hrnkp out in Ko
promises to be somewhat less next either the debt or equity markets.
possibility of stagnation at a
Scuril" year. Since the flow of funds to In the early postwar period, we stocks will continue to flucutate level well below the capacity of
rea, cash a
g
with corporate bonds, the spread
savings institutions and the savsaw the bulk of the flow of sav¬
the country's resources because
lags of individuals should be
in yield makes them only moder¬
we do encounter a cyclical down¬
ings directed through institutions
^hinSL hid higher, we might conclude that which were unable by law or cus¬ ately attractive at present. There turn and we also find that we domay be a good buying opportuni¬ not know all the answers to the
Recently enacted there will be a better tone to the tom to put any significant portion
.dropped to 59%. Recently enacted nnvnr.r_f_ hfmrl
and thp
in equity securities.
This condi¬ ty, however, in the months ahead. question of how a deflation can
under

investments

stock

A roaring bull

conditions.

this
further.
the cash positions of

legislation

tax

measure

has reduced

of liquidity even

The strain on

^expenditures; f ,P

is likely to

.Eventually this is

in several

^^e?utahdeuad fhere

The

trend

•

common

stock

prices, as always, defies predic¬
tion. Despite the squeeze on oper¬

respects.

First, the open-end

^cuSy'
Roughly speaking, it seems ap»? ?+i+,Vr. viincr
availahili+v nf propriate to divide 1952 into two
SS *2'^ified workers halves. The first half-year of
^SfmJwhatlater accelerated amor- hea vcorporate demands for
Inl Inlarl fhP rpTnrn *unds may well witness further
ttip

S fnni
of funds,

gradually been modified

tion has

investment
may be trusts have developed the tech¬ ating margins and the heavy im¬
the rate of a sufficient bunching of new isniques and the selling force for pact of taxes, dividends should
and pnninsues to keep these markets in a
remain close to the present level,
gathering a sizable volume of
high as it state of considerable uncertainty. funds from individuals. Net sales even though below the 1950 peak.

corporation^ will undoubtedly
mnnfhs n? l^2y
y
*a

^°ratf ^rket
r'fXaUv this

selling of government securities
by the principal savings institu-

1947 aver¬

1946 and

shares in

aged about $200 million, whereas
they may approach $300
million.
Trusteed pension funds

this year

probably acquire some $200
million of common stocks com¬

will

companies in fa¬

Well-managed

checked

and

find

is acting as a leveling
influence. Although, on the whole,

decline in vol¬

to the

vulnerable
ume.

A Doctrine of the Middle of

the

Road

situated industries will,
course, do better, but the tax

structure

would undoubtedly
corporate profits extremely

eventuality

vorably
of

within

reversed

period of time. Such

short

Canvassing all of the possibili¬
ties

is, however, a pursuit of lim¬
value except as it convinces
of the basic truth that the fu¬

ited

the picture is moderately reassur¬ us
negligible purchases ing for long-term investment in ture is not predetermined but
five years ago. The spread of full stocks, we all know that over the but rather what we make of it in
problem bntil
expendltu^s level the year>
a i0Wer level of
short run prices will vary from our own fumbling way. The most
out and start to decline. Work
g pjan^ an(j equipment expenditures and modified prudent man rules
what we may anticipate in ac¬ important
point in relation to
applicable to personal trusts has
capital
^
d?§ is anticipated, the savings institucordance with what investors are dealing with our investment prob¬
sgreatly enlarged if inventoles are tions may be much more comfor- undoubtedly induced large com¬
willing to pay for stocks in the lems is that we should aviod the
Telatively stable.
However, we tably situated. The timing of such mon stock investments for those
light of their hopes and fears for pitfalls of static analysis in a dy¬
Iteoow^ t h a t will be rising
defense production a change in the bond market is purposes. The life insurance com¬ the future.
namic economy. We should avoid
inventories
panies are just starting to become
^jmd not subject to precise measure-

How

hnt
J?i

thprp

will

too

real relief from this

fmanm

tions.

During the

with

latter half of pared

whsen

♦creating a problem
ments, but perhaps around
contractors even though produce s year w»jj serve until the situation
"°f clviban goods may
ind
i becomes subject to closer analysis,
.situation
eased somewhat by a
J

J^r defense.

mid-

modest

liquidation of inventories,

Government Financing

York.

the

1952

calendar year.
the

Under

the
credit

circumstances,

decline

-seasonal

bank

-during the first half of the
may

be relatively small, and

volume of outstanding
loans

likely to

year

the

commercial

remain at his-

torically high levels. This suggests
firm tone in short-term interest

are

requesting, and

The Longer Range

Outlook

have concentrated
some of the fac¬
tors which may influence our in¬
vestment
activities during the
Thus far we

our

attention

period between now and the

equities.

pluses in

the

result

invest

payment of tax liabilities will find seems appropriate, since it does
that this particular line of credit not appear likely that the Treasiias been cancelled in part.
The ury win have to raise new money
ireverse
situation, of course, will pri0r to the close of the fiscal

prevail in the latter half of the

obtain next year, permission
a portion of their sur¬

may

special significance will

the laws of New

The mutual savings banks

New York

be
The preceding comments are
the
operation
of the so-called based largely upon an appraisal
Mills Plan which will require the 0f the supply and demand condipayment of 70% of Federal in- tions likely to prevail in the pricome taxes on 1951 profits during
Vate capital markets. They do not
the first half of 1952. The company take into account the size and
which has been financing a por- scope of Treasury operations. For
tion of its working capital
re- the period between now and the
ujuirements out of the delayed middle of next year, however, this
Of

the field

factor

of the change in

end

But all of us expect
be in business for a long time

kind

mechanical

projec¬

tion which assumes that while one
factor

economic

the

outlook

all others remain the
same.
It just is not so. That being
the case, we ought to retain flex-

changes

iblitiy in

of next year.

and

buying in the market is often ex¬

beyond that date.

our

investment programs
extreme posi¬

tions.

aggerated, it is a factor of very
real importance.
Compared with

the

While

total

five years ago,

stock

new

$200

of institutional

the volume of net

What are some
factors which
ought to take into account as

running only

face the

issues is

$300 million higher, while
sources of equity funds

new

may

running

twice those

of the longer range

investment problems

by the present economy?
doubt * most of you have

created
No

heard

the

forecast

frequently

avoid

The
bank

taking

point

be illustrated in

can

portfolio management. Nei¬

ther extreme liquidity nor

reach¬

into 1 onger
maturities in the hope of catching

ing
a

out

shift

rates

extensively

the

level

justified

interest

under the

cir¬

of a major cumstances which currently pre¬
amounts. This field is not subject
to precise measurement, but the cyclical downturn in business be¬ vail. I happen to believe that the
ginning after defense and foreign long-term trend of interest rates
year.
However, in the second general implications are reason¬
aid expenditures start to decline. is
flat or slightly downward from
the barrier against
half of 1952, the Treasury will be ably clear:
This is based on the passing of the
present levels, but this is a trend
facing a substantial deficit on a stocks which previously existed
cash basis, and there remains the for most institutionalized savings capital expenditure boom and the which could bev interrupted for
fact that war-induced shortages of extended
periods and one of those
question .of how this will be has been breached for at least a
housing
and consumer durable periods may be now. It seems to
portion of such funds.
handled.
The case me that favorable opportunities
What these developments sug¬ goods have been met.
if a complete revision in savfor this sequence of events can be
new exist to acquire sound earn¬
ing's bonds terms were made the gest is that there may, over a
quite persuasively presented, with ings assets, but I certainly would
basis of a sustained drive to mo- period of years, be some closing
bilize individual savings, it is con-

being made these days

the

gap

between

bond

and

considerable

reinforcement

from

not

advocate

exhausting

the last

could stock yields.. However, this is a logic and experience, even though bit of the liquidity and flexibility
the factor of timing in such fore¬
factor.
Institutional
and, on the whole, a fairly tight be met with little difficulty. The long-term
which only short maturities can
casts has always presented great
buying cannot be counted upon to
money position for the commer- big increase in personal incomes
difficulties in the past.
provide.
cial banks.
will occur among workers in de- cushion the market against de¬
Another large section of opinion
clines
which
are
generated by
In
the handling of funds for
In addition, we have to reckon fense centers who can be most efeither the bursting of a specula¬ holds that we have learned a great
with the policies which the mone- fectively reached by payroll savindividuals, the same principles
tive bubble or by a persistent de¬ deal about cushioning a decline in
fary authorities are likely to pur- ings plans if an effective appeal is
rates

for

commercial

borrowing ceivable that the problem

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1873)
apply.

Stocks have

tion for the

some

attrac¬

rate of return which

easy

from

escape

difficulties

our

Russia's Designs on the
Middle East

appraising what lies ahead. I1
dissent from this view.

they provide but nothing has real¬
ly happened to make them free of

strongly

risk and impervious to the effect
of technological Changes and com-

problem

petive

of the

conditions.

The

tested

believe

the

that

the

is to avoid

difficult

most

investment

field

following the fashions

moment, to maintain a bal¬
standards of investment analysis,, anced point of
view, and to keep
on the
contrary, are more impor¬ one's judgment from being unduly
tant than

ever:

good management,

aggressive research

and

develop¬

influenced by mass psychology as
we see it so often
generated in the

There

has

mention

been

made

tions in Iran.
it

ties

which

the

present

people

Some

economy.

describe

may

this

the

scope

quite beyond
analytical abili¬

our

Russia

remain

may

uncertainty for

fraught
to

years

with

come.

oil

other

than

propaganda quantities.

small

Over 200

such

tankers.

over

mountain

steel

and

her

and

most

readily available;
employees can be re¬

cruited from. nearby communities.
In these communities, the tax¬

Availability
East

to the United States.

less than 8%

duction

oil

Product

imports

At that time

of Middle East pro¬

brought into this
provided the funds to country,
build roads, schools, hospitals, and
'The natural market for Middle
transportation facilities. The em¬ East oil is the
Eastern Hemi¬
ployees build or rent their own sphere, particularly the great in¬
pay

their

and find their

own

was

utility bills, dustrial

recreation. The

own

areas of Western

Africa

tremendous

and

presumably

Asia

and

productive

own

Now let

payers have

homes,

10,000 feet

Russia would do better to

in Middle

Europe.

product availability.
The sus¬
pension of production in Iran this
summer

created

situation,
been

but

filled

quest
the

cooperation

oil

companies,

abroad.

result

abroad.

constructed

this year,

materials

Europe, Africa, and Asia, and,
the other hand, make it pos¬

imported,

Light's

farm

current
a

machinery and hau

earnings

figures

arc-

strike at the Caterpillar

Farm

have risen 117% and gas revenues

revenues

electric

sales

practically at the saturation
point, with average sales at around 6,000 kwh. annual average, as
against the 2,500 (eastern) national average. The influence ot
are

REA's in the
is

area is negligible.
The balance, of electric revenues
quite heavily weighted in the industrial field, with domestic-

revenues

4%.

The company now has 27,000 gas space-heating customers and
residential business is around 35% saturation, while the company

re¬

Power

for

However,

United

States

here

Commission

receive

additional

gas from Panhandle^
restricted to small unito
and emergency needs, and it is questionable how much relaxation
of these limitations will be permitted
by any additional allocation,

and

foreign

and do¬
have
been

space

heating additions

are now

allowed at this time by

the FPC.
.!
Capitalization ratios, including the $8 million bond issue pro¬
posed for issuance in December, 1951, will be approximately at)

to make Middle East oil available

handle

Since 1941 electric

264%.

line

very

both

Both

Illinois

full

plant in September.

government

our

"Central

revenues.

estimates that it could reach 65% eventually. The company usesserious £ straight natural gas obtained primarily from Panhandle Eastern
vacuum
has
Pipeline, and it recently received authority from the Federal

the

from

manufactures

now

neous

untrained labor. Facilities must be
to

which

contributing 32%, commercial 21%, industrial 43% and miscella¬

Availability

turn to the question

mestic

also

develop

possibilities.

production
represent
fast-growing markets.
The
oil stepped up, spare refinery capac¬
company
operating there must companies serve as a middleman ity has been utilized, and products
provide
practically
everything. in this trade-^they provide the have been taken from inventories
All that is available is land and link necessary, on the one
this
hand, in
country
for
shipment
Middle East is very different.

•

right-of-way

passes

undertaking,

Middle East Oil and
crease

Light Company, which was formerly in the
Commonwealth & Southern system, is the fifth largest electric
utility in Illinois. It serves 2,000 of the 56,000 square miles in the
State, covering three separate areas (two of which are inter¬
connected), centering around DeKalb, Peoria and Springfield.
V
Besides being the largest distilling center in the world, an
industry from which the company receives appreciable revenues,
Peoria is also the location of the Caterpillar Tractor Company,

somewhat depressed from the effect of

tons

are

Light Company

Illinois

25,000 employees, representing about one-quarter of the industrial
labor in Peoria. It contributes about 10% of the company's gross?

high. This would be

contractors

Central Illinois
Central

While she might
charter quite a few
more, the total would not be im¬
pressive.
By land, at least two

purchase

inch" pipe lines would be
needed,
involving over 400,000

Continued from page 20

Product

By OWEN ELY

almost entirely through the denial
of Iran's oil to the West.
Russia
has
no
means
of
transporting

Iran's

Utility Securities

benefits

"big

international situation

Public

inten¬

Over the near-term

that

appears

considerable

Russia's

ment, favorable industry charac¬ investment markets.
large tankers would be required
This is always important for us
teristics,. a strong competitive,
to move Iran's normal
production
position, r and sound financial who are engaged in the care of
by sea from the Persian Gulf
planning,-are still at a premium, other people's money. It is espe¬
through the Suez Canal and to the
not at a discount.
k.,
;
cially vital when, in addition to
Black Sea.
Russia reportedly has
I suppose this all adds
of the usual hazards, there
up to the all
the equivalent of
only a dozen
doctrine that we should seek a exists imponderables

middle-of-the-road position in our
approach to investment problems

follows:

Debt

48%

——

Preferred

the fourth

COmmon

quarter of
125,000 barrels per day

of
Middle East crude .that had
a supply of water must on
developed, roads and utilities sible for the Middle East countries been coming to the United States
to
purchase food and manufac-^ has been diverted to
built, houses for employees pro¬
European
vided along with schools, hos¬ tured goods from abroad.
refineries and replaced by
in¬

equity

34
100%

pitals,

stores,

recreational

facili¬

bases

skilled

for

its

operations. The
must .be
brought

labor

from abroad at high rates of pay,
and the

creasing domestic production.

Currency Problems

ties. In other words, the company
must build communities to serve

would

likewise

touch

further

the currency problems that

upon

the Middle East oil oper¬

concern

The

ators.

American

controlled

employee and his family companies have

many dollar obli¬
transported at company expense. gations. These include royalties,
the equipment and labor that are
Every effort is made to restrict
only available from the United
the
number
of
American

shipping

are

The'company's bonds

are rated Aaa by Moody.
The $8 mil¬
will be to provide funds for extensions
distribution facilities.
It is estimated that the company will earn $2.85 in 1951 and $3

lion bond issue proposed

of both gas and electric

average

because of the Abadan shutdown.

shortage
is

avia¬

tion gasoline.
The situation

regards the first

Commission to make

em¬

States, and the payment of dollar quarter of 1952 is not so certain.
ployees
to
those
positions
for
dividends to the shareholders.
Although production in Kuwait
which
nationals
of
the
various
and

distance, and also provides
these people with housing and re¬
a

duction

lated

facilities

the

operating

Although the rates of

areas.

for

labor

common

are

pay

compara¬

worked out with the British Gov¬

also

tinue to

ing of American-controlled oil

tial

the sterling area.
A condition to
this settlement, however, was the

these

low,

the

workers

that

the

productivity

also

Arabian

low,

with

oil.

American

Oil

Company, together with its sister
company, Tapline, have invested
nearly $600 million in the Middle
East.
-

our

This

maximum

made

sterling

as a result of other miscellaneous adjustments and the
application of EPT, the effect on earnings is considered to be neg¬

royalties

minimum

which

payments

the

and

ernment,

which is the

new

are

really

the

gov¬

coun¬

that their ability

to
be extended to meet their

Continuing

ficulties

currency

can

con¬

substan¬

in prospect.

are

pattern for

op¬

requirements.

cover

dwelled

some

length

the problems connected with

barrel of Middle East
production is about the same as
that from prolific production in

upon

this

Since Middle East
oil is a great distance from mar¬
kets, the posted price for crude
in the Persian Gulf is $1.75 per
country.

barrel

Middle

that

foj

This

crude.
on

compared to about $2.65

barrel

per

from

means

East
a

similar
oil

domestic

the net return

prolific

well

West

field.
I

under

Texas

ducers

certain
need

our

have

■

domestic pro¬
no
fear that

the

oil

business

the

its

allies.

Before

Western
were

the

war

Hemisphere
own

think

not

this

"all

present
operations

basis

out"

will

the

foreign

reserves

77%.

transmission

that

cilities.

could

not

sion

producing and

re¬

ure

the

tremendous

consumption

their markets in the United States.

that

nate in

the

severe

that faced

currency prob¬
foreign operators

in the last half of 1949 and

1950

did

not

cause

any

early
large in¬

our

sure

in
we

this
are

in¬

has

country.

most

fortu¬

having Middle East oil to
meet the growing requirements of
Europe, Africa and Asia and to
supplement our own production
as

required.

•'

to
up

industry will

just

meas¬

have

to the challenges of

Power

may

due

from"; 104.38%

bonds

Co.

made

Aug. 13

Florida
101.377%

Award

interest.

was

are

1981,

Light

accrued

tive sale

competi¬

the group's

bid ofc 101.10%.
Net

these
vide
to

Whatever the situation may be,

only supply
requirements, but I'm

proceeds from
bonds will

meet

electric

other

the sale of

used to

additional facilities

pro¬

required

the

growing demand for

and

gas

corporate

service and
purposes.

for
The

company's present estimates an¬
ticipate that its construction pro¬

for the years
1951-1952,
inclusive, may approximate $39,500,000, of which
amount
ap¬
With Central Republic
proximately $20,500,000 will be
for
1951.
The
portion of the
(Special to The Financial Chronicle)
construction program for 1952, as
OMAHA, Neb.—Chas. E.Warrick
now contemplated, which may re¬
has joined the staff of Central
quire expenditures of as much as
Republic Company, Farnam Build¬ $19,000,000, is expected to include
gram

the past.

ing.

;

■

has nc&
formulation of ifes

General redemption of the boncfer

offering
first mortgage bonds',

$10,000,000
3% series

the

back to normal operation.

the

distribution fa¬

company

construction program for 1952.

Kuhn, Loeb & Co.

and

Although I am hopeful that a
satisfactory solution to the Iranian

and

The

completed

fining facilities.

measured

because

emer¬
are

sustained without provi¬

also the bulk of the petroleum re¬

crease

The company's common stock is currently selling on
York Stock Exchange around 36 and pays $2.20 to yield

too

quirements of the Eastern Hemi¬
sphere. This is no longer possible

taken
place
Accordingly,

Even

the

sufficient to not

this area's

Six steam generating unit olf
R. S. Wallace station scheduled for
1951 financing includes the 100,00(11

there will prob¬
surplus abroad, but

some

I
do, however, wish
to
problem will soon be found, it
emphasize the importance will take months to
get the oil
this area to our country and
fields and the Abadan refinery

"cheap" Middle East oil will flood

lems

Middle

East.

Number

February (bringing the total te
proposed bond issue in December.
the New
6.1%. II
selling at about 12.6 times earnings and the dividend payout is

900,000 shares), and

again

per

the

by then,

serious

Importance of the Middle East
have

item

60,000

well
I

normal Abadan shipments are re¬
sumed

dif-. gency,

profit-sharing

erations abroad, we find that the
cost

these

—will

can

Moreover, the company feels that the proper realignment
will place the company in a better position to ask fon-

shares of common stock sold last

currencies
needs.

rates

construction

available

What will happen later in 1952

ably be

well,
and
must be found to

means

ligible.

quantities of additional re¬
products from the United

tries at least in part in their own

Considering the above costs, plus buy

the

and

ways

be a gross annual re¬
indicated in the bond registration

kw. capacity at the
operation early next year.

make oil available to

(as

States.

that

make

and

countries

would appear to

$278,000

necessitated

has

purchases

materials

some

fined

minimizing of the dollar content
in

quick rate relief in the future should this become necessary.
The company's postwar construction program, inaugurated or
large scale in 1947, required the expenditure of over $9.5 mil¬
lion in 1951 and will call for about $6 million in 1952. The largest;

doubtful

depends largely on whether or not
foreign- Abadan operations are back to
equipment capacity. If it is not, I think the
the result that there is no such
and
maximum
employment
of increased production from other
thing as low-cost labor in foreign
people who will accept other than Middle East sources and the new
operations.
dollars for compensation. The dol¬ refinery
capacity that will be
You may be interested to know lar problem is
pressing in non- available—particularly in Europe
tively

large number of changes in its rate sched¬

statement)

Saudi

ernment last year for the market¬

While the net result

ules.

Arabia
is
The countries that import most
mounting
countries are not qualified. Ac¬
of the Middle East oil are, how¬ rapidly, there will probably be a
cordingly, each of the major oper¬
shortage of foreign refining ca¬
ators in the Middle East employs ever, short of dollars. After months
I am
of negotiating, arrangements were pacity to handle that crude.
many
thousands
of
nationals,

often-times having to recruit them

It is

paying about $200,000 EPT annually, equal to some
22 cents per share.
The EPT ceiling is about $2.50 per share to!
1951, but "will probably be somewhat higher in 1952, because the
company will have a certificate for rapid amortization of about*
$4V2 million of new property. The company will save on elimina¬
tion of the electric energy tax about 10 cents per share net.
The company recently arranged with the Illinois Commerce

of 190,000 additional barrels
per
day of finished products abroad

The only serious product
that now exists abroad

1952.

extensions of existing

be made at prices declining;
to
par.
Special
redemption
prices
range
dowzv

from 101.38% to par.
Florida

Power & Light Co.
operating public utility princi¬
pally engaged in the business o5T
generating, transmitting, distrib¬
an

uting and selling electric energy..
The company is also engaged in.
distribution and
sale of natural gas.
The company
operates wholly within Florida,
and is not in direct competition
the manufacture,

with

any

privately

publicly

owned electric or gas

utility com¬
pany or agency.
The company
supplies electric service in 354t
communities,
including
Miami,,
West Palm Beach, Miami Beachij,
Ft.
Lauderdale, Daytona Beaciv
Fort

St.

Myers,
Sarasota, SanforcL,
Augustine, Bradenton, North

Miami, Coral Gables, Hialeah andl

generating, Hollywood.

The Commercial and Financial

(1874)

■

X
Continued

LAI

elude

JjmAW J AM#
HfiVA All lllQCPvIlUUllI
r

MVk

in the early portion of 1951, it
of frequently was necessary for a
private business.
aeaier to disclose the name of, or
On the other hand, the Gover- otherwise identify, his customer
nors of the Federal Reserve Board
in a Treasury security transaction
are appointed by the President, and
to the Federal Reserve Bank of

indirect

*********

Market Committee one group of
men who might be expected to
lean 'toward the government's
point 0f view, and another group
0f men who might be expected
to lean more toward the point of
view of private business.surif? however, the Federal Reserve

eiimmarv

vipw

fains

ranitai

this

anoronriate

The piercing nature of the
being conducted by the

thev?

are

isfactory, the latter might withhold an execution. On some occasions this was the equivalent of
denying the Treasury security
holder access to any market, or to
any bid even at a lower price. The
Reserve Bank also turned down,
on innumerable occasions, one
seller of securities whose identity
had been made known to it by a
dealer, while simultaneously accepting a comparable transaction

Has the growth of nub-

lip

dpht

chanjypd

thp

methods

can

nrndentlv

nature

Federal

the

Reserve

with resnect to

use

nolicv?

credit

and

monetirv

the

what extent is the expectancy of

interest rates more or

trend in

less

than

important

level

tho

With respect to reserve requirements-what
What

merits and

the

are

asset

are

T!L

reserve

The

Federal

serves

secondary

maintain

Should nonmember banks

tary credit restraint program

conditions, if

lssuance

Un-

en^1
teAA ^crease

would
compulsory sales of government
securities
be
desirable for
(a)
banks, (b) other financial institutions, (c) other corporations, and
(d) individuals? What are the advantages of marketable and nonany,

of substantial

What

merits of

stable

bond guaranteed to be

have

you

any sug-

gestions for insulating public debt
securities from the impact of restnctive

credit policies designed
discourage the growth of pri-

vnfp

is'

any,
iy,

the statutory power, if

whereby the government
dirertlv

control

tension

ration

credR

this

noint

pv-

ind^idDTl
individual

banks?

the

w":■

diversitv

the

from

time

nwn

temptation
issues

such

circumstances,

deal

with

the

these

general terms that

may

whoily ineffective m the de-

bate

ahead

tionnaires

us.

Yet

the

ques-

expected to provide the machinery
through which the interests of

private banking,

lending, and of
business would resolve their needs

i t h

Reserve

Board

Governors

invite you

by drawing who are empowered
by Congress
your own practical experience to
exercise
a
responsibility for
to prove your point by illustraProviding an elastic currency. The
tions. This you can do effectively,
ownership of the Federal Reserve
on

The fifth classification asks for
information
and

expenses

ernment

earnings

income

of the various gov-

including

the
Federal, who operate with funds
other than Congressional appropriations. As I mentioned, such
groups,

information is also
the

member

requested for

banks.

the ultimate purposes

may

point out the percentage of
income

that

derived

terest received from

curities,

the

amount

that

guess

Banks

the

member

banks

symbolic of this intent.
Two-thirds of the directors
the

Federal

Reserve

Banks

is
of
are

elected
by the member banks,
Five of the Presidents of the Reserve

Banks

12 banks to
the

Open

are

selected from the

serve

Market

be to

gether with the

gross

of the BOard.

members of

Committee

seven

to-

Governors

The Douglas Com-

from

in-

mittee

Treasury

se-

the open-market transactions had

expense

become the most important single
instrument available to the Sys-

that is defrayed by such interest,
and the part it plays in producing

tern.

the net earnings of banking insti-

and

tutions, including the Federal.

three

The mechanics of enlarging the

money supply, through the support of a given interest rate, re- ;
mained with us. No effective steps .;

had been prepared to permit the
desirable flexibility in interest
rates. . ,
Korea provided a coup de grace..;
The purchasing power of the dollar was quite sharply reduced as
individuals expecting shortages
began to spend, and as government and business did the same or-.
prepared to do so.
This, I believe, has some bear- j
ing on certain investment arithmetic, I would like to give one
example. If an individual in 1945
acquired a fixed-income security,
and if he were to receive repayment in 1951 in dollars of equal
purchasing power, a semi-annually compounded interest rate of
6% would have been required.
'

If such an individual were to

interest in dollars with an equal
purchasing power to those of 1945,;
would have required an 8 /2%
rate, compounded semi-annually ;
* ^on t believe t h a t savings

ol^r^n^to1 ooki^out that*we '

private

effect,

un-

Federal:

£ aS^t^ow^a
?™asurv sleuritl market during
d

^vS^ear n^rJffled^AS
tfonarv consciences of
large

the

nr^ani7ation

t^e

methods

time

hearings

seems

emphasized

that

appropriate

throughly consistent with the
principles

have

outlined

both

will flow to

orivate

Pmu

and

the

fhwefore dTtTgWe

Up service to
non-bank financing while contin-

on-

•

? iman"ng wniie connn

have widened
A general'
credlts nave wiaenea. A general:

ana major upsurge,

overnight, m»

wmdd'hT J^t "effec'tivAat"thi? ^
AXI

tho

fJLnSti

stage> m detlating the inflation..

U1"g to fln+lnce through the banks. The Treasury deficit must be fi- .
During the war many Treasury nanced and the Treasury must besecKu"ties 7®re Purchased by the able to refund. : An undesirable

nro-

Tttain

banks

public and its non-bank institu-

n0rtion

Treasury

borrowing

toKnTthough

tions^as temporary .mvesimems. Sy °^ve to be done through the .
th!}
""ns ,as leII,i'°™ry investments. may have
A£ter l,he war, the failure of Con- banking system, Even so, the vol-f
gresa to provlde successive cash „me of reserve credit needed,
surpluses commensurate with out would not increase with a rise in
prosperity had two results.
interest rates. A decline in pri- >
One, as non-bank institutions vate . borrowing would make it .
and miscellaneous holders wished possible to absorb a Treasury defi-v
to sell Treasury securities for cit with a smaller increase in;
various peacetime purposes, some- Federal Reserve credit. If the ,
one else had to acquire this Treas- Treasury sold its securities at ury debt. The government's cash comparatively high interest rates,,
independence for private surplus ; did
not
provide k for coincidentally with a forced de-

manv

onr

it,

of the Treasury debt

oration and t^ methods or pro

crStTare to^be'run'and^dmto-

nrn

either

Reserve,

prints money in the process.
>
If an Administration is inclined

likA tn furmhasiVp

T WnuiH

not contrary to these principles, nrinrfnlPc nf
or conformed to them, I found the Son and

in,s Pumi> 1 wouia iiKe to

see

banks,

Federal

the im'portance of clearly delineating the differences between

7^"

-v?

opposition Where,

thought

ties

main independent of direct control by an Admistration.

technical advant
disadvan.
taees easier to resolve-

would

^0W} if the government is un-

„
.f
.
hanking
and
11^C)m llJr}e ,r? lime» 10 aiiain a
.
credit are to be ru" and admin" g'ven objechve. i
'
^TC^whSmta? I^vouldh^^ istered by private parties, and if Federa, Reserve Independence
that vou
lUce mvseh
coulri
he the regulation of such activity is
ISfcS™'' 5
easilJThrown off haM^e attomnt i» be impersonal, something or •>
Must Be Maintained- ,
inff to take either the
rnn
somebody must be interposed beI trust I have made amply clear
Sde in debate over
of the
tween the Private banking and my fervent belief that the inissues rai^Pri
TnnrJani credit machinery of the country dependence of the Federal Re7ation
W ^frpoupntlv^ find niVr" and uur political government. This serve System must be maintained,
selves'ho^pH dnwn in nnnwivahip Place is filled by the Federal Re-' It does not necessarily follow,
pmrtpntinn^ciu^ppfT
serve System.
.
however, that an
independent
i
suDjecis.
The System> ag y0u know> was Federal Reserve System insures
Under
.

can

Must Have Flexible Interest Rates

Secretary °£ ,the Treasury, Con- able to meet its expenses, it may hSU been Pushing prices
sshave>jn^diree^t rep:re- print the money or sell Treasury
would erg**
£
p
gp
sentation throu|h the members of securities. If it sells these securiNX Ind'although the

ample or illustration with which

may

the

direct representation through the

Mn-

couid think of some practicol ex-

rfpht?

What

the further increase in the money s,
supply and by the ability of the
puolic to add to it, almost at will.

Preityumu^ the principles set and indirect representatives, to high spending it may wish to
we need to.
°rth by Woodrow Wilson, and would be assured of more than a be consistently assured of easy move fmward in the direcUon of
followed by Carter Glass, in work- working majority in any clear- access to additional money, There- ^e^Fs ba^c^ie^^ °ut 'he compromises neces- cut test 0f strength with the in- fore, a high-spending Administra- the r eaerai s Dasic objectives
sary to the creation of an elastic direct representatives of private fjon tends to be an advocate of
mufl,lg^er
currency through the Federal Re- interests. The Committee, along jow interest rates. The lower the ? ^
:
di¬
serve System. Using them, I found wRh the Board, should be respon- interest rate, the greater the like- ?n„or^ef
Ds.°
rls?-kV" '
sible t0 Congress> bllt, it would re- nhood that a substantial portion
.ween
or ime
and lei prime •

government borrowthe merits and de-

Further, do

the nrinting of

Tom-

contraction of the the Board and private interests
cu™ncy.
,
would be represented indirectly
Frankly, I was rather pleased by the Reserve Bank Presidents
later to realize that these were The government, with eight direct

are

deerlaL

£!*Mnsion n?^ rontracUon

to purchasing power?

monev bv the Fedbond holders, m general, make up'*.
ine/"iiung w inuney uy rrcu their minds as to the desirability '
eral Government, and the issuance l«eir minas.as 10ine a^iraDurcy
0f
bonds to private banks or °* savings bond investments by •
central banks, is the cost of in- PeaPs of such computations. But,

estate

real

MavkPt

mittee. Provide, m addition, that
the Secretary of the Treasury be-

Dm-mit

bp
or

; ™

marketable securities under present conditions, and in the event

other government policies; materially inflated living costs. The
post-war rise was magnified by

come a member of the Open Mar- terest. This must be permitted to in *ime.» they arrive at the same
ket Committee. This Committee ^crease or decrease consistent C0?C^10^th.
u?
^
thus would become one 111 which with the desirability of an expan- rr-Lf^
Aithpr
bonds to private
Administration would have sjon 0f +ue currencv
Treasury pay to anyone either 6%

separate grouping we find
--explain and evaluate the volunder what

Anpn

Three. The essefttial difference

member banks?

and

consumer,

credlt to the Open Market bom

ing?

achieved

nidation

be required to maintain the same
reserves

fOvernments musi oe acmevea

re-

maintain seconaary re
through instruments and methods
addition to present re- that ore imnersonal in their an-

serves?

u s

ac-

State

and

cases,

Committee, whichever makes the
The Third Principle
most sense' Then, transfer the
Although my talk is 0verlong,
Present P°wers of the Board of j feei impelled to comment upon
Governors over discount rates, the third principle. This is, that
reserve requirements, stock mar- the essential difference between

regulation

0f DHvate banking and credit

SvSiS

to
to

Thursday, November 15, 1951

a n d the Federal Reserve System be have received 2y2% per annum,
agencies more responsive to either maintained at all costs.
,
as rental for his money, the rethe Treasury or the Open Market
; payment in 1951 of principal and

crpdit

nnH

necessary

advantages of requiring (a) all
the
member banks and (b) all insured governments m
banks
Danxs

...

departments

government

administered

must

different holder. In many

the decisions were whimsical.
the desired coordination between
in no sense does such a critigovernment
departments and cism, directed to methods, take
agencies and the Federal Reserve, away one iota from a principle,
One would be to make the various namely, that the independence of

stitutions?
;•There are safer ways to obtain

by private hands.

plan?
the advantages and disan

hanidnf

mjtinn'c

machinery

One: The normal functioning

rofpe7

demerits of

were

Committee is impressive, almost bewildering. I immediately
felt in need of certain bench marks
with which to find my way
through the maze of subjects covered and their interlocking complexities. Finally, I established
three principles with which to test
each proposal or point of view.
These are
'
man

nresent?

made directly responsive to
political administration, is it not
ciear that we would risk losing
the protection that presently exists for our private financial in- 0f a

Pat-

vey

selec-

What

annrooriate

are

Three Principles

ex-

losses have

and

eonnection?

controls

tivp

For

hearing do actual or noten-

What
tint

rredit controls

how

*mnlP

the relative efficacy

execution through the

not enough. The Bank requested
''a story" as to why the holder
wished to sell. If the dealer could
not say, or if the Reserve Bank
officer felt the story to be unsat-

^pn^ral

Bank. On many occasions this was

character of

ments these men may be expected
to be more susceptible to the sociai trends of the times than might
be true of the Reserve Bank Presidents. Thus, we find in the Open

classification was mis^
success
cellaneous. The questions in this
SL
issues if the terms
group are directed to an expansion
Jprf^!S?vairpprf Iinoif^ad- oi the coverage of deposit insurvvere mutuany agreea up
ance> the adequacy of banking favain*hn,,ld rpfurn however to the cilities throughout recent years,
nf +hp mixtions 'related
Changes in the ease or difficulty
tA
■fhp
management
of
money
with which small businessmen
hankinfr
anU credit
have been able to borrow or raise
AnShpr1Jthpep ask for noints capital, and some other items.
My last

Fed-

the

rpfurn

1QC-1

tain

of the

representation

Federal Reserve System! ;» Designated by him. By virtue
their appoint-

Of'

Committee should in-

that such a

jrom page 11

Chronicle

adequate
banking and lending institutions,
I would like to restate the sec-

ond principle. The necessary regu-

lation

private 'banking

and

enough debt retirement in relation
to the large private demand for
Vgoods and services. Consequently,
the residual purchaser was the
Federal v Reserve; System. These
purchases printed money that was
five to six times more powerful

cline in the demand for private
credit, an increased demand for f
Government securities-would appear f r o m .non - bank sources.'

credit activities by the* Federal
To the extent the Treasury prices'
and State governments must be
its new issues generously; the need
achieved through instruments and
-Federal support would he
methods that are impersonal in than money printed by the pur- definitely reduced. - *.
,
;1
their application. This applies just chases of private banks. > K > ?
- v, All of these considerations.must
as much to the methods that are; Two, the money needs of pri- be combined with the fact that the
,

vate business to finance recon-- Treasury has
it does to the methods' version and to enlarge peacetime nance, during

employed by the Federal Reserve

System

employed by an Administration.
Private lending institutions are
asked
in
the
questionnaire
if
"moral suasion" has contributed "
to

their

investment

since

July,

1950. " This

changes

practices

been forced to fi-;
the/past year, solelyX
productive capacity were tre- through short-term or redeemable
mendouS: The tax structure, par- paper. It ismecessary to widen the
ticularly the treatment * of gross difference between currency and
income applicable to interest on Treasury securities,, An overnight ,
indebtedness, and the double tax- increase in Treasury short-term
ation of net earnings disbursed as interest rates to
or 3% is de-

(

sirable. wnatever theJevel either^
Jawer or
j'
u
®. °11?e *
that would reduce substantially indirectly, this expansion in pri- me marginal borrowing demand,,
vate borrowing also added to the and niake . snort-term
Treasury ^
supply of money.
:
. securities
increasingly pieferanle.
These factors, plus the enlarged to- cash.
; . ,

invites comment upon the degree dividends, caused
the external
by which the Federal open-mar- ;money needs of business to be met
ket
operations, that have been largely by borrowing. Directly or
held to be an impersonal instru-:
ment,
have
been
personalized
whenever it
suited those who
handle such transactions.
During a large part of 1950, and volume

of wartime savings,

and

Furthermore, an enlarged inter-

Volume 174

est cost

Number 5064

The Commercial and Financial Chronicle

public debt would dis¬

comfort those who tend to be

Continued

It is clear that he

beneficiary
and, in the final analysis, this is
ultimate

principle.

production of those products required chiefly for defense pro¬
Meanwhile, military and related defense requirements are
rising steadily and promise to continue to expand.
Despite growing evidence of slackening demand for consumer

the Patman
clearly of great
importance. Regardless of where
the hearings may lead, the ques¬
their views.
from

will

-thanks

bankers

deserve, and I

receive,
the

area
v

out.

give

ing diversion of semi-finished steel to production of those products
in more acute shortage, notably plates which can be rolled on

sure

communities

plates,
shapes, in that order.; " f
Whether the slackening in demand being experienced in some
areas of the market accurately reflect basic economic conditions is
In especially tight supply at present are

continuous mills.

you

bars and structural

serve.

Explanation for this seeming paradox is found in the
being offset to a large extent by increas¬

pressure.

grateful

the.

Canadian Atlantic Oil

debatable, "Steel" asserts.
There is evidence to indicate some of
contraction being experienced in certain lines is directly

the

Com. Stock Offered

attributable

there still is

Offering is being made today of

headed

group

■

offering 1,125,000 shares
-of the stock in the United States,
'-while the remaining 25,000 shares
'are
being offered simultaneously
Canada

'Of

-for the account of Pacific Petro¬

; ~

Proceeds to be received by the

-outstanding bank loan from The
of

Oct.

flurry of orders in virtually all

they had little tonnage open for the month.
to

operating

point from

This

steel

-1951, and the balance will be used
.from time to time for such corpo.

But

the

0.1 of

which

Canada

$872,000

their commit¬
In struc¬

barring order cancellations.

come

and

Steel Institute announced

this week

companies having 93% of the
steel-making capacity for the entire industry will be 101.1% of
capacity for the week beginning Nov. 12, 1951, or an increase of
that

000 shares will be

Bank

experienced

American Iron

The

from the sale of its 500,applied first to
'.the liquidation of the company's
•company

Royal

Certainly

production.

tural, however, the situation presents a different outlook, it notes.
While supply of shapes is short, fabricators are showing noticeably
less concern in their inventory position with their order backlogs
shrinking due to government restrictions on building.
Early this
year they held well over 12 to 15 months' work on order.
Now
they can accept rated tonnage for delivery in five to six months,
this trade paper concludes.

are

.amounted

rate purposes as the directors may

and

castings

steel

ago.

2,021,000 tons of
industry, compared to

rate is equivalent to

for

entire

the

a week ago, and 102.1%, or 2,041,000 tons
A year ago it stood at 102.7% of the old capacity

amounted to

Among the purposes
jfor which such funds may be used

1,980,800 tons.

Electric Output

Attains New Historical High in

are,the.exploration of, acquisition

Latest Week

of interests in and development of

The amount of electric energy

prospective and proven oil and
gas lands and the development of

and

the

mated

company's existing properties.
Upon completion of this financ¬
ing, the outstanding debt and ca¬
pitalization of the company will
consist of 2,931,671 shares of $2

the industry and
the

or in joint
ownership with others and of en¬

natural

extent,

•

total of the price per pound

sum

reserves.

25,406 cars, or 2.9%
1950, but an increase of 258,762
or 44.7 % above the comparable period of 1949, when loadings
reduced by major strikes in the coal and steel industries.
*

The week's total represented a decrease of

cars,

in the Prov¬

gas

Wholesale Commodity Movements

were

The

wholesale commodity price index, compiled by
Inc., finished slightly higher last week follow¬
ing a mild dip at mid-week.
The index closed at 305.02 on
Nov. 5, comparing with 304.25 a week earlier, and with 297.79 on
the corresponding date last year.
.
:
,
Movements in leading grain markets were mixed for the
week.
Wheat firmed up in the latter part, aided by pessimistic

ciated

Francis

Ray¬

become

Hefner has

with

asso¬

Pont

Co., 722 South Spring Street. Mr.
Hefner was formerly with Cohu
&

Corn was unsettled and
irregular. * Heavy selling of the yellow cereal reflected the possi¬
bility of a cease-fire agreement in Korea and reports of colder
weather which is expected to hasten the curing of new crop corn.
greater exports from the United States.

strengthened under steady demand coupled with small
Trading in grain futures on
the Chicago Board of Trade increased moderately to a daily aver¬
Oats prices

receipts and light country offerings.

with 47,000,000 the previous

of 51,000,000 bushels, compared

Trading in cocoa was fairly active as

wise dull domestic market.

with most futures reaching new lows for
Warehouse stocks of cocoa showed a further

values continued to sag

the current season.

reduction

during the week, reflecting

shoremen's strike.

little

net

there

was

continuation of the long¬

;

Prices for coffee futures held

narrow

cago.

week in the United States was

wtih CruttenAngeles and Chi¬

change during the week.
In the spot coffee market,
an urgent demand
at ceiling prices for supplies that

points

week ago.

over a

rise

The

largely

was

influenced

units from

Lard

steadier the past week

was

of recent weeks.

New and Larger
Bros. Inc.

Strauss

removal

29% below the like

last week's

output rose to an estimated 112,680

revised total of 111,735 units.

In the like

output totaled 153,695 units.
output for the current week was made up of 87,778 cars

and

in the

quarters

larger

the

building, 42 Broadway, New York

City..

and 22,292
'

trucks last week and 126,412 cars
1950 week.
last week was placed at 4,903 cars

the comparable

new

same

against 89,443 cars
and 27,283 trucks in

24,902 trucks built in the United States,

and

Quarters

announce

offices

their

Total

Canadian production

5,709 cars and

;:/;>//;

With Stone & Webster

Business Failures Rise

(Special

The Financial Chronicle)

nolds is

now

111.—John

& Webster Securities

South

Rey¬

affiliated with Stone

Clark

Corporation,

Street.

was

formerly with Channer Securities
Company.

Joins Staats Staff
(Specie! to The Financial Chronicle)

SAN FRANCISCO, Calif .—Helen
M.

connected
with William R. Staats & Co., Ill
Sutter Street.
Tighe

has

become

Slightly

150 in the
week ended Nov. 8 from 143 in the preceding week, according to
Dun & Bradstreet, Inc.
Although casualties were up moderately
from a year ago when 135 occurred, they fell considerably below
the 1949 total of 222 for the similar week and were down 44%
Commercial

CHICAGO,

and

2,875 trucks the week before
1,634 trucks in the like week of 1950.

2,900 trucks, against 4,133 cars and
and

from

the

prewar

and

industrial

failures

increased

level of 269 in 1939.

with liabil¬
ities under $5,000, which rose to 34 from 23 last week but remained
below the 46 of this size recorded in 1950.
Casualties involving
liabilities of $5,000 or more dipped to 116 from 120 but nonetheless
The

week's rise centered in small failures, thpse

exceeded their total of 89 a year ago.

following the sharp declines

Although wholesale pork prices continued lower,

smaller marketings.
their upward trend during
the week. The advance, which lifted values to new seasonal highs,
reflected buying influenced by the request of the Department of
Agriculture for increased production' next year, the favorable
outlook for export business, and the trade expectation of a further
reduction in the Nov. 1 government crop estimate.- Entries of
cotton into the 1951 loan stock declined from 92,387 bales to
86,400 in the week ended Oct. 25, bringing total entries for the
season
to 628,170 bales.
Exports of the staple for the season
through Oct. 30, as estimated by the New York Cotton Exchange,
totalled 1,102,000 bales, against 1,012,000 in the like period last
strengthened as the result of
Domestic cotton prices continued

year.

Trade Volume Extends Advance of Previous

A further mild

Dun &

Further Mild Decline

drop in the wholesale food

price index, com¬

Bradstreet, ,Inc., brought the Nov. 6

figure to

Week

slightly throughout the nation,
in the period ended on Wednesday of last week, partly in response
to vigorous promotions and partly as a result of sustained cool
weather in many regions.
The week's retail dollar volume was
noticeably above the level for the similar 1950 period, according to
Dun & Bradstreet's current summary of trade.
The presence of cool weather was deemed responsible for a
moderate increase in the sale of overcoats, topcoats and Winter
suits in scattered shopping centers, bringing apparel demand to a
level somewhat above a week ago.
Requests for men's suits were
limited in some sections, while the demand for some articles of
children's clothing was seasonally low.
The over-all consumer purchase of food dipped slightly dur¬
Consumer

spending

rose very

ages.

in the demand for bever-

price adjustments on many items, however, helped
on a level substantially above a year

Upward

dollar volume

maintain

earlier.

Total retail dollar volume for the

week

last

ago.

these

period ended on Wednesday
to 6% above a year

estimated to be from 2%

was

Regional estimates varied from the levels of a year ago
percentages:
England,

+6; South

Midwest,

and

Southwest

+4; East

+1 to +5; Northwest +4 to +8 and Pacific

Coast

+7.

+ 3 to

Ordering at the nation's wholesale markets rose

slightly in the

aggregate during the week, reflecting increases in both fill-in
requests and Spring bookings.
The total dollar volume of orders
was considerably above the level of the corresponding week a year

The number of buyers attending

ago.

various wholesale centers

slightly above that for the prior week and for a year earlier.
Department store sales on a country-wide basis, as taken from :
the Federal Reserve Board's index for the week ended Nov. 3,
was

1951, increased 11% from the like period of last year.
In the
preceding week an increase of 5% (revised) was registered above
increase of 7% for the four weeks ended

the like 1950 week and an
Nov. 3,

1951.

For the year to date, department
of 3%.

store sales regis-;

tered an advance

Retail

trade

New

York

reacted

favorably last week to

promotions, and as a consequence, most types
registered increases.
The over-all advance for

of merchandise
the week ap¬

proximated 8%.
According to Federal Reserve Board's index, department store
York City for the weekly period ended Nov. 3, 1951,
advanced 7% above the like period of last year.
In the preceding

sales in New

week

Wholesale Food Price Index Reflects

piled by

further tightening of

live hogs

week of last year

Strauss Bros. Inc. in

supplies resulting from the dock workers' strike.

raw

New

For the United States, total

York advanced about 10

markets, but the spot raw market at New

week of last year.

was

;

Passenger car production last

slightly below the previous week, and about

the past

■

and showed

immediately available.
Raw supplies, however, were re¬
ported very tight as stocks continued to pile up on docks.
Sugar futures trended downward in the domestic and world

B. Dunbar & Co.

den & Co. in Los

range

were

John

Co. and

outlook for

reports on the wheat crop in Western Canada and the

of 1950.

(Special to The Financial Chronicle)

mond J.

Irregular

daily

ing the week following a decided drop
Auto

—

Dun & Bradstreet,

Output Makes Slight Advance From Previous Week
Combined motor vehicle production in the United States and
Canada the past week, according to "Ward's Automotive Reports,"
rose
to 120,483 units, compared with the previous week's total
of 118,743 (revised)
units, and 161,038 units in the like week

Hefner With du Pont
ANGELES, Calif.

Show

Trend in Latest Week

kwh. above that of the pre¬

below the corresponding week in

limited

ince of Alberta.

LOS

the

Loading of revenue freight for the week ended Nov. 3, 1951,
837,743 cars, according to the Association of American
Railroads; representing a decrease of 26,218 cars, or 3% below
the preceding week.
..
'
;

It is currently engaged in the pro¬

and,

previous week.

totaled

gaging in exploratory and devel-*
opment work for the purpose of

oil

all-time record high for

Carloadings Resume Downward Trend of Previous Week

hejd under concession

new

ceding week; 822,031,000 kwh., or 12.5% above the total output for
the week ended Nov. 11, 1950, and 1,961,560,000 kwh. in excess of
the output reported for the corresponding period two years ago.

Co., Ltd.,
is engaged in the business of pro¬
ducing and0 selling petroleum and
"natural gas from lands leased or

duction

compared with 7,319,019,000 k'wh. produced in

The current total was 77,086,000

Canadian Atlantic Oil

adding to its oil and gas

distributed by the electric light

industry for the week ended Nov. 10, 1951, was esti¬
7,393,115,000 kwh., according to the Edison Electric

The current total established

stock.

common

power

Institute.

value

20.

represents the

foods in general use and its chief function is to show
general trend of food prices at the wholesale level.

ago.

2,019,000 tons

month

and

week

week's operating

ingots

101.0%,

rate

-determine.

par

Feb.

week, and 50,000,000 in the like week a year ago.
Flour prices were generally steady.
Scattered bookings of
small lots of hard Winter wheat bakery flours featured an other¬

ments for months

by Ross Whittall Ltd.

leums Ltd.

fact, they will have little tonnage available outside

offering,
500,000
being sold by the com¬
and the balance is being sold

pany

index

age

observes.

total

the

The
of

first-come first-served basis for January
under government regulations, it adds.
:-7
Plate producers were under pressure for additional tonnage
on the
first-come first-served basis just before Nov. 2, "Steel"

Co. is

government restrictions

large unsatisfied demand for steel as evidenced by

their books

open

-Reynolds & Co. and Bear, Stearns
*&

recorded

major products just before Nov.,2, the date on which they were to

dian Atlantic Oil Co. Ltd. at $6.75

share.

the fact producers

-1,150,000 shares of $2 (Canadian)
common stock of Cana¬

^par value
-per

$6.64, the lowest level since Nov. 21, 1950, when it stood at $6.63.
The latest index compares with $6.52 on the like date a year ago,
or a gain of 1.9%.
It is down 9.2% from the 1951 high of $7.31

goods

fact the slack in sheets is

experience,

vast

manufacturers, some interests in this consuming
report difficulty in filling their needs, this trade paper points
This is true even in sheets which are definitely under less

durable

If you speak loudly,

your

will

you

are

invites

grams.

The issues posed by

tionnaire

Industry

third

the

test

questionnaire

you

The State oi Trade and

general public

would be the principal

and

page

high

This would be healthy.

spenders.

"the

from

(1875)

change

was

but for the four weeks

recorded from the similar -week of 195Q-J
ended Nov. 3, 1951, an increase of 3% was

registered above the level of a year ago.
For the year to
volume advanced 5% from the like period of last year.
-

date

Continued

from

Corporations in general, however,
have shown a steady upward in¬
crease
in
net
working capital
since before World War II.
The

page

The Outlook for Youi Dividends
Is indicative that

cost, non-integrated producer can
a sharp gain in earnings on

xncreased

operations.

While Bethlehem is maintaining

the present $1.00

indicated quar¬
terly dividend rate on the com¬
mon stock,
Pittsburgh Steel has
declared

stock

common

dividend which is the first distri¬
bution

Spar

the junior

equity since
old $100
stock in 1930.

payment on the

cash

value common

The inference to be derived from

the above comparison of earnings

Commis¬
sion estimated total corporate net
working capital at close to $80
Securities

Stock Options

smaller, high

score

not

While

employee

ex¬

thought should be
given to the possible effects of
stock options granted to key per¬
sonnel.
The chief effect of such
stock options would be a dilution
of the shareholders' equity when
the options are exercised.
How¬
ever, most employee stock options
plans cover less than 5% of the
outstanding common stock and
thus, the dilution factor does not,
some

pense,

in the total picture.
There is an offsetting factor in
that the stock is not being given
bulk

large

Exchange

has

lost

the

its

sale

would

moneys

company's

added

funds

inventories

receivables.

and

This is in part a

reflection of the
large volume of business handled
and, in part, a reflection of a
higher price level.
It has, un¬
doubtedly, importantly influenced

favorably situated industries
/should be able to maintain the
current rate of cash distributions.

not

Companies engaged in
♦stable industries

such

food, propri¬
etary drug and cigarettes may
♦suffer particularly from
higher
corporate
XJue

normal

the

and

surtaxes.

stability of the

very

not in

are

position

properly used, options do
a threat to the share¬

Earnings Retained for Expansion
Current

plant

equipment
will call for

and

expansion programs

to^offset the increased tax burden

substantial capital outlays by cor¬

with

porate managements in the period
ahead.
It1 is believed that total

larger

volume

while

competition

make

price

Many

Gound

increases

these

sales,

controls

and

difficult.

concerns

are

investment

under current

quality,
but
conditions, dividend

"reductions may become necessary
"1*1 some instances.

outlays

for plant

equipment
for
1951
will
approximate $25
billion, a new all-time high. The
substantial

Capitalism

Welfare

capitalism is
subject in so far

sague

ating

its
earnings

effects
on
dividend

rather

financing.
sponsible

relatively

in the corporate picture in recent

and

the

costs

per¬

covering

these

items

cost.

Obviously, payments to

for the
*so

from

account

far

the

total

labor
or

employees in

vacations,

sick

leave,

health

benefits,
unemployment
insurance, etc., must also be in¬
cluded with the costs of pensions
the

under

heading

-Capitalism.

The

Welfare
total

sum

these expenses is quite large and

increasing

at what may
be a
rather alarming rate.
It is inter¬
esting to note that when organized
labor

felt pay rates were pretty
much in line with the cost of liv¬

ing, greater emphasis
•on

welfare

placed

was

fringe

benefits.

Unquestionably, expenditures for
Welfare will increase as time goes
on.

new

opment

and

interesting devel¬

this

field

which

able

to observe in the
years ahead is the demand for an
i^iay

annual minimum wage instead of

postwar

the

than

years

the

industry

expansion programs

may

have some tem¬

porary moderating effect on divi¬

and

breakdown

re¬

for the
conservative rate

distribution

The current

ment of pension, health and other
^employee welfare programs.
It

employee

was

payout as a percentage of
earnings prior to World War II.

dend

new

rate of

,years as a result of the establish¬

is somewhat difficult to make

This factor
large part

dividend

war

earnings

borrowing

evalu¬

programs for employees at cor¬
porate expense.
These expenses
jbave bulked increasingly
larger

^accurate

than

largely

were

retained

Xt deals primarily with the estab¬
lishment of welfare
plans and

centage

period

from

payments.

and

modernization

postwar

rather

corporate

and

expansion programs undertaken in
the

financed
Welfare

pected

-.I,These

employee

cash

policies

the

due

large

requirements for materials
equipment.
Obviously, U. S.

Steel's $400

million plant at Morrisville, Pennsylvania, will have
some
bearing on dividend pay¬
in

ments

the

although
tained

immediate

leading

benefits

the

from

this

tor
U.

ob¬

operation

ultimately result in
distributions.

may

increase in

doubt this fac¬

had
considerable weight on
S. Steel's recent declaration of

only the regular 75c dividend for
December,
whereas last
year
shareholders
cial

received

distribution

75c

along

spe¬

with

work

However,

industries falling in

for

under

whereas the automotive producers
not

cessity will allow a sharp build¬
up in the cash position once the
properties are being amortized.
It is entirely possible that some
portion

funds

these

disbursed

least allow

may
shareholders or

be
at

managements to take

liberal policy toward the
distribution of earnings.
.
*,

earnings

are

the

chief

tion, employee costs

such

ably

less

than

Ultimately, the

firri

glance.

consumer

actually

determinant

distribute

dividend

enable
some

profits.
pansions

are

tionary pattern rof, the

what

company

portion

to
the

Where

the cost of these increased
benefits through higher prices as
Unas been evident in the infla¬

pay¬

pays

years..

Welfare

last

capitalism

few

is per¬

heavy plant ex¬
underway or work¬

ing capital
requirements, are
large, distributions may be some¬
must

restricted.
also

Consideration

be given

to senior

se¬

haps an indirect'subsidy payment curity requirements including not
jby the consumer rfather than by only bond interest and preferred
the

corporation -itself
Jhplders. ' ' >•

its stock-

stock dividend payments, but also

maturities

and

sinking dunds.

for

funds

expansion

purposes.

industrial

the

chosen

the

companies

ities,, generally

creases

higher
percentage of earnings in the form
This

of dividends.

ity shares to sell
rather

price

basis.

prices

The

and

bacco,

1950.

1949 and

did

1941

through 1945 than in the
preceding peacetime years. How¬
ever, the low profit margins ob¬
tainable

ings

stocks

would

ments

effect

have

not

beneficial

Dividend

distributing

80%

tions

New Financing

New
effect

financing

takes.

the

Increased

the

Israel

distributed

the

There

pattern

postwar

dividends

the

for

payments, de¬
which it

certain

advan¬

stock

of companies averaging ap¬
proximately 50%
in the years
1946 through 1950.
Nevertheless,
here too, total dividend payments
were larger although the percen¬
This
1951

pattern

and

gaging
business

for

of the oil
particularly,

certain properties

Block,

Lease

County

proceeds from the sale
shares are to be

The net
of

the

299,970

drilling costs and

used to pay for

resort to stock dividends for year-

for

working capital.

end extra distributions rather than

for the tax benefits derived there¬

Oklahoma.

entirely

tages to increasing debt structure

Creek

companies will

many

phases

in all
and,

to drill wells on

smaller.

likely

seems

beyond.

possible that

cents) which were

(par 10

recently offered to the public "as
a speculation" at $1 per share.
The corporation was formed in
Delaware for the purpose of en¬

with

group

was

Oklahoma Oil Corp. common

tral

selected

same

the

all

was

years

tage to total earnings

form

are

shown

this

members

Co.,

Dealers, of New York, have sold
of the 299,970 shares of Cen¬

war

years

National Association of Securities

level of activity reduced the per¬

centage

in the selection and reten¬

Central Okla. Oil Stk.

form

Israel & Go. Sells

taxes, plant
expansion programs and the higher

have some

may

dividend

pendent

distributed

whole, despite price

an£ welfare capitalism.

ever,

pre-World

dividends.

all-will not fare equally well.

the average, about 75%
War II earnings

some

tion of individual securities since

net

earnings to their shareholders. A
recent
compilation
of
selected
that,

word of caution is advised, how¬

companies

90%

may

,..

controls, the excess profits tax and
othef adverse government regula¬

Trends

find many

i,:-. r

in the rate of dividend

factory'as

permanent

In prewar years it was not un¬
common

'-.y

payments in 1951 and 1952, they
nevertheless should still be satis¬

the prices of the shares.

-: Conclusion V-

reduction

com¬

dividend; pay-^

total

;

Although there

fo?; income; In many vola¬
companies, tempo¬
rary increases in dividend pay*
tile industrial

mensurate

:-v

ments

continuation

dividend payments.

ship¬

leather,

(

ments.
V,;

be regarded as invest¬

can

activity

common

taxes

during World War II.
The air¬
craft
companies,
on
the other
hand, scored sharp gains not only
in sales, but also in earnings and

financial,

following tabulation more
fully summarizes the beneficial,
effects of high level industrial,

stable, character of the

utility industry when the

earn¬

distributions

the cash payments distributed last

from, and in

some

tually possible to

it is

cases

ac¬

through tax savings by borrowing.
On

the

ties

other0hand, senior securi¬

which

convertible

are

stock

into

restrict,

may

the

reason

the

(Special to The Financial

The New York

recently
ninth

reported

that

for

the

first

sale

rect

common

additional

cases

convertible securities
is

mon

given to
latter

sold

where

the

or new com¬

means

of rights

stockholders, the
compensated, in part,

common

are

the

dilution

of their

position

since they may either subscribe to
the new securities at a designated

price
or

(usually below the market
anticipated market price) or

they
f

r e

sell

may
q u e n

the

rights

which

tl y possess substantial

value.

Seidel

Spring Street.
COMMON STOCKS

1st 9 Months 1950

vs.

Estimated

Payers
:

v '

;

*V<

■

•

No.-

Issues in

INDUSTRY—

Payments

1st

Div.

ft Mos.

1951

Group

Increased

financ¬

ing recently undertaken or con¬
templated is being utilized for
plant expansion or modernization
of facilities

which, in themselves,
in larger earning
power. It is a little early to eval¬
uate the potential benefits from
some of the newer plant construc¬
result

Per Cent

ft Mos. 1951

Div.

Change

Reduced (000 omitted).

Same

Aircraft

$30,413

Amusement,.

41,998

413,493

43,213

79'

Automotive

Building

Trade________

Chemical
Electrical

Equipment

406,048

26.9%
9.4

—

—12.8

4.0

+
+

1.5

•

104,743

9.4

Farm

Machinery

______

____________

& Beverages

Leather

Its

Financial

Products

103

Office Equipment

72,632

161,839
"■>

Machinery & Metals___
Mining
'
___"

-f J6.7

43,277

Food Prod.

•

—

14,370

—

23,830

4 10.0

572,937

Railroad & RR. Equip._

+
%

G5.817

45
'

Estate_____

Trade.

Retail

____—

_______

177,814
' 10,654

Shipbuilding & Oper.—
Steel

200,063

28,213

8,810

Utilities
U.

•

__—

Opey. Abroad
Companies.:—
Companies

S. Cos.

■

178,918

3.0.,

7.7".
22.0

__.17.0-o

■

•

+21.0

3
2

69.303

57,132

—'

572,001-

12.1

101

___

...

35
•

_____________

5
20

3.1

28.8

+ 17.3:

Tobacco

Textile

+24.7

6.9

141,539

Real

0.7

127,500

1.3

Petroleum & Natural Gas;

Paper & Publishing.

1.2.

15
■•=

new

Company,4

No. Div.

Rubber

Nevertheless most

should

458 South

NYSE LISTED

1st 9 Months 1951

stock, of course, has the

effect.

same

Di¬

Morton

affiliated

become

has

Adler

with

number

result of conversion.

as a

nine

of shares which may be outstand¬

ing

the

Chronicle)

Calif.—Herbert

LOS ANGELES,

dividend

year,

CASH DIVIDENDS

junior equity by
increased

Stock Exchange

consecutive

distributions

extent, the dividend poten¬

tialities

Morton Seidel Adds,

year.

earn more money

55,490

24.5L_

•

22
—_

26-3
2.1

•

Foreign

81,054

23.4;+

Other

28,982,

12.Hj7

TOTAL

______

1,049

943

363

443
r

'•'

NOTE—Above table is from October issue of

137

■

„

$3,730,093;:;

"Exchange" Magazine.

:S>
i<

', L

The

This is probably a reflection of

the

increased

dividend

and

auto-

i95Q?;.>;^.y.

favorable levels, and

although the total dividend
payout was actually larger.
A

the

licly at

they have raised much of their
new junior capital by this means.

decline in net

and

resulted in

addition

building and ship operators re¬
ported lower payments this year
than the amounts distributed in

per

were

profits has enabled the utility
companies to sell their stocks pub¬

equities

levels reported

Motors, as an example,
larger volume of business

17.5%,
and rubber up 22.0%, steel
iron up 21.0% and utilities up
up

motive industry, amusements, to¬

re¬

General

and

railroads

24.7%,

equipment

12.1%.

utility

for

in relation to

tires

yield

merely

and

railroad

the util¬

more on a

to earnings

higher

causes

than

basis

sulting

out

pay

groups

ings

reinvestment of earnings, util¬

showing larger earn¬
their percentage in¬
were
aircraft, up 26.9%,

mining

rely importantly

maintain earnings at the excellent

for

While

esting contrast to many industrial
in the method of raising

companies and industries showed

received

ne¬

inter¬

expected to be able to
achieve sufficient volume to
are

have

companies

semi-war conditions,

war

some

certificates

narrow.

sharp increase in
sales volumes, such as the aircraft
makers, total profits should be
quite large even though the per¬
centage
in
itself
is
relatively
small.
In
effect,
the
aircraft
makers
should
do
quite
well

common

plant expansion and
improvement programs which

those

able to report

Those

ments, financial position must be

consider¬

ex¬
some

economy,

generally quite

are

increase in the regular payment to

-deductible items for tax purposes
mid thus, under high level taxa¬
are

category will include the
aircraft, automotive and ordnance

75c.

Financial Position
are

seg¬

are

payments. Of the
issues, 443 reported larger
payments, 363 were the same and137
declined.
In general, "war •
babies" and capital goods . pro¬
ducers reported increases whereas
those fields catering primarily to
civilian activities declined. Among
1,049

provide

12.8%

showed

issues

lower dividend

concerns

this

future

com¬

expenses

economy

participate
the defense

to
of

merely an hourly basis
pensation.
V, _'.s\

virtually all

the

holder, but rather may be an
makers.
Direct government con¬
advantage since they are an em¬
tracts will be subject to renego¬
ployee incentive to improve the
tiation and it has been historically
overall position of the company.
true that profit margins on this

businesses in which they are en¬

gaged, they

phases

present

utilities

The

Nevertheless, liquid finances have

While

automotive

facilities to round out and improve

have

the

When

ments, however, varied sharply as
exemplified by the 47 oil. and'
natural gas stocks, which showed
a
gain of 28.8% whereas the 73

bank of small units dat¬

its over-all position.

industry 'pay¬

Individual

000,000.

by Jones & Laughlin to
a

While

ments

general corporate purposes.

melt shop being con¬

new

structed

the amount of dividend payments.

the
for

used

and

the

are

tury.
Pittsburgh
Steel is also
greatly improving its trade posi¬
tion through modernization as well
as
the acquisition of additional

work.

730,000,000 were 9.4% above the
1950 nine months' total of $3,410,-

period, cash items have not
shown as large a percentage in¬
crease, the bulk of the gain being

These

shares.

will great¬

ing back to the turn of the cen¬

same

ly augment the position of many
of the companies. Good examples

obsolete high-cost units

replace

1951, as against well under $40
billion at year-end 1941.
In the

the

exceeded

year's distribution for the i same
period. The 1951 dividends of $3,-

billion at the end of the first half

its

motive producers, may well re¬
duce dividend distributions, while
other strongly entrenched units in

months

tion, but in many cases it is fairly
that the replacement of

evident

been
sufficiently strong enough
that
total
'corporate
dividends
position, but away, but rather sold at a price
close to the public market price have increased fairly steadily
rather, that despite present-day
since 1941.
problems of increased taxes, price prevailing for the shares at the
controls, etc., some of the smaller, time the stock option is granted.
Renegotiation
more marginal
companies are in Thus, the corporation is in effect
Renegotiation is primarily of
undertaking new financing to a
a position to resume or pay more
concern
to those companies en¬
liberal
dividends.
Some
good restricted group and would re¬
gaging
largely
in
government
companies, such as leading auto¬ ceive certain cash proceeds from

and dividends is not that Bethle¬

hem

Thursday, November 15, 1951

The Commercial and Financial Chronicle...

(1876)

[Volume 174

Number 5064

The Commercial and Financial Chronicle

...

(1877)

history

Continued from page 15

about twice

as
great as they were
at the time the memorandum was

written.

this

startling, for example:

(

Gold—lust Another Commodity!

The comparison of the present
1951 prices with those of 1932 are

shows

1932

Consumption

ing

that \such

arrangement

would be constructive in the pres¬
ent world situation.
•
•'

"The commodities

considered

for

be non-rperishable

non-perishable.
divided

into

which

the

three

could

have

Commodities produced principally
of the United States; (2)
produced in the U. S. A.,
in the

country
the

measure

war

itself

be valuable in case

which

not

are

war. A supply
clas^ 1 commodities would also

made

and

storage

outside

control

exported in volume

at the

the

attempts

the

were

production and price

"Even though these commodities

not used in war,

were

have

they would

per lb. except for crude oil which
is given in dollars per barrel. The

time in the future could be fitted

annual

into

consumption for the United

States
ten

the

(1922-1931).

years

The

calculated

values

postwar

from

this

sumption figure

same

Y.)

1/3

some

the nation.

commodities

You

Y.)

have

were

used

lent debt which cancellation many

con¬

people, especially from the other

merce and no

this

definite plans made

time

for

their

modities

ultimate

are

aluminum.
ties

consumption, but that they would
be held as part of the natural re¬

are

The class 2

com¬

lead

copper,

and

The class 3 commodi¬

crude

oil,

sugar

raw

.05

and

note

material

that

.170

.88

2.570

progress

196

ity when

!■

.029

548 lbs.

the

total
would

$5y4 billion.

682

637

110

689

$5261

1.257

owners

gold, they do give
material, products and

ices

the

market.

position

same

This

change

Commodity
L

■

Group No.

Rubber
Tin

Silk

have

gold,
made

would

not

only
but we

big profit,
importantly increased
a

would have

the real assets of the nation.

did

government

mark

Our

the

apparent
to

profit which

balance

anced

used

was

otherwise "unbal¬

budget.

But this did not

Perhaps

would have
ical

been

even

commodities

established

nation

our

and

im¬

would

greater

what

$.0323

security for
might have
But if

;

gold for the other
products ahd services

materials,
they wanted.
the

only advantage

of dollars would have

owners

if dollars

The

were

freely convertible
gold would be in case they
wished
to
spend
their
money
into

abroad

in case

prepared for it when it came.

$111,000,000*

$338,550,000

56,100,000
36,200,000

29,500,000

264,000,000

378,000,000

$467,300,000

$81,000,000

$245,000,000

Lead

1,152,000,000 Lbs.

-.0287

33,100,000

.16

26,200,000

$820,550,000

$342,100,000

163,957,850 Lbs.

$218,000,000

44,000,000

$140,300,000

_______

Aluminum

While
.

Group No.
Crude

•

76,800,000

53,100,000

40,000,000

■

Raw

Sugar—

10,450,000,000 Lbs.
548,493,600 Lbs.

$682,000,000 $1,210,000,000 $1,050,000,000

.029

304,000,000

.20

110,000,000

the

nation

have

General

value-added

did

not

always

Motors

con¬

industry and that it

our job to buy materials at
the market and convert them into

423,000,000
272,500,000,

480,000,000
244,000,000

that

buy.

It is
speculation

our

in
in

lb.

per

"The acceptance

Finance

disarmament

discussions.

and

avoid
mini¬

"A reasonable

of these

reserve

commodities to consider would be

goods

between

the

rest

the

world would be about the
-though the equivalent
value in gold

world.

the finances of the
same as

additional

has been mined out¬

the USA during

the time
were
being

commodities

shipped to the USA. The produc¬
tion of the commodities involved

tional

Committee

some

commodities

two-years' consumption for class

that

could

our

business.

three,

addi¬
imme¬

not

our

did

for the

money

of buying

purpose

diately needed in

the

these

their

disturb

USA

and

further

The effect

specific

point

trading

com¬

at this time,

commerce

not

Motors

Actual average $1.19 per lb.

these

payment

exchange

side

maintain

However, in
this particular case, the General

appropriate

would

policy

and

$1,439,003,000 $2,714,900,000 $2,929,350,000

Total

■^Figured at 10c

non-use

wanted

$1,096,000,000 $1,905,500,000 $1,774,000,000

Grand

modities

people

inventories.

mum

Total

business but

ultimately be used in
A

of which

committee
was

one,

was

five

below the average of prewar val¬
ues

and at

25%

and

which

would

not

influ¬

by our tariff wall would
certainly
help ,.us
to
decide

enced

whether

not the. debtors would

rate of not more than

the allotment in any one

Using these figures and
assuming that the average price

committee because prices were so

low
our

was

difficult to^ake

minds to buy.

Mr. C. O. Miller,

year.

"Besides

and

honest

their

that
in

(getting

point

reserve

information

of: view

regarding
intentions, the fact
of the commodities

question would be

defense

measure

would be 75%

for our

national

country

might be of considerable value

assumptions of the plan are log¬
ical and sound."

1932)

old inscription in

appeared on the first silver coins
coined in Britain.
The English
translation

"By

the

this

industry

inscription is
the people

the state flourishes."

familiar

with

silver

our

the

God We Trust."

putting

these

two

all

are

which

"In

I would

recom¬

confidence

our

ideas

maintaining

You

inscription

dollars

mend

a. means

value for

a sound

our

currency rather than its converti¬

another

bility into gold.
So, I would like to
should

what

again,

say

considered

for

really

is, namely, just
commodity,V I am not

they could
the currency just as well
trying to mark down its value to
they could hoard the gold if the people of the world or trying
they expected later to buy at a to tell them what they should use

hoard
as

lower price.
I

it for.

that the country will
much better off if we

sure

very

adopt sound policies in regard to
our

credit and confidence money
order to avoid both inflation

depend¬
convertibility of our
currency into gold to accomplish
free

gold

the basic

that to

sure

means

rely on
for main¬

taining and stabilizing the value
of our money would again be a
great mistake. The world has long
since passed the point where the
personal privilege to hoard gold
can be
justified as
objectives of life.

of the main

one

Continued from page 14

We Should Have Free Gold Markets
ment

the sale of gold for in¬

acceptable to that government to

dustrial
purposes,
although
it
should continue to buy all gold of¬
fered at the rate of $35 per fine

The gold producer
asking the government to
increase the price it pays. In fact,
he is asking that the official buy¬
ing price for gold remain un¬

cease

ounce.

should be made clear to the

Administration that sales of gold
to central banks and governments

effective.

not

changed, All the producer wants
simple justice, the fight to sell

monetary purposes should be his product at whatever price he
made sparingly and only after the can obtain in the national or world
for

most

careful

scrutiny

the

character of the country of desti¬

nation.

In the past, much of the
gold sold to central banks found

markets. He is asking to be freed
the
strait-jacket .of price

from

control clamped on him seventeen

We all know

years ago.

the

that

now

1934

its way into premium markets. It
also seems evident that most for¬

price was based on a
complete misunderstanding of
monetary
principles.
Time
has

mercial

mediately after 1933 our financial
structure adjusted
itself to the
new
price and the new supply
of gold that was
brought out by

who had had

There

Federal Reserve Bank.

seems

active

trust of the present price

offered

the

United

dis¬

of gold

States

great deal of purchasing expe¬

prewar

fully specified and
inspected.
However, none of the many details
incident to this plan seem very
difficult
provided the main

pay if they could.

Latin which was supposed to have

gold

Treasury for purchase or sale. An
values, rience and was in charge of the unchanged Mint purchase price of
would
use
production facilities we obtain a total figure of $2,- General Motors central purchasing $35 per fine ounce would protect
already available, increase em¬ 442,150,000, or an average pay¬ at the time, had the responsibility this country against those for¬
ployment, -and probably increase ment of principal of $488,430,000 of actually make the purchases eigners who have been raiding our
the price of these commodities. per year by this means.
approved by the committee.
I gold supply during the past 25
"Of course, the suggestions made remember of having a meeting of months with the hope that they
This activity and price increase
would stimulate business and the here do not constitute a complete the committee, and Mr. Miller and can eventually resell this metal to
prices of other commodities and plan as many details would have I recommended additional pur¬ the Treasury at a price higher
rubber
at
3J/2C
It would prob¬ chases. of
would probably hasten the return to be considered.
per than the $35 per ounce.
Since we had already
of prosperity.
ably be desirable to include other pound.
Under certain circumstances the
"A serious consideration of the commodities, some chemicals for purchased 50 million pounds, the Treasury could continue to sell
desirability of making such a com¬ example. Storage facilities would majority of the committee were gold to friendly governments and
have to be worked out, particu¬ unwilling to buy any more rubber central, banks at the
$35 figure.
modity
arrangement
might
be
thinking perhaps it might This right to sell should be left
Perhaps at
worthwhile even though it were larly for sugar and oil.
even
the
oil would
have
to
be
ex¬
go lower.
About two days optional, as it is in the present
not ultima ted consummated.
The
Under
the
1934
law
the
debtor nations maintain that they changed for oil in reserve in this later Mr. Miller came into my law.
office and said, "I am sure we
possibly
still
in
the
cannot pay because we will not country,
Treasury is not required to sell
made a mistake in not buying
The quality of the com¬
gold to anyone; sales are per¬
accept goods and they do not have ground.
I said, "Charlie,
modities would have to be care¬ more rubber."
mitted, but not required. In my
enough gold to make payment.
An offer to accept goods (com¬
modities) which they could supply

coined

been

centennial celebration.

Wilson

silver coin from.

had

appointed to carry out this idea.
year for class 2 and 3.
We only spent about one-half the eign countries prefer gold in their
quantity to be taken in
own possession or earmarked for
demonstrated only too well the
years as long as prices are money that was available to this their
account, to dollars in a com¬ fallacies of this proposition. Im¬

1—one

This

part of

It had

small

„

sidered

products

776,076,000 Bbls. $.88

Wool

$334,800,000

3—

Oil

which

of currency to depreciate in terms
of gold.
Otherwise,

ing

was

Total

Mrs.

ago,

received

anything about this idea, we did
do a little about it in General
Motors.

$.05

1.615,000,000 Lbs.

weeks

74,500,000

32,600,000

2—

Copper

stabil¬

merely closing

What General Motors Did

$202,703,000

Group No.

(1922-1931)

making

to the economic facts of

Some

they wanted to
hoard it, having no confidence in
currency and expecting the value

and deflation rather than

finally able to avoid
would have been better

(World War I)

98,000,000

Total

ex¬

their

Value

36,250,000

.360
1.46

67,000,000 Lbs.

the

gold

gold and would then have to

war,

Postwar

Before

$35,853,000

.225

-90,500,000 Lbs.

_______

(1932)

serv¬

if they could
exchange their currency for

first

have

161,000.000 Lbs.

Nickel

*•'

1—

Prewar Value

,;/• Value

(1932)

1,110,000,000 Lbs.

—

Present

Price

Yearly
Consumption
;

call

would have been in

piling

owners

If our country had just
adopted
this policy in 1932 instead of going
off gold convertibility and stock¬

had not been
Present
.

call

much

into

are

life.

England

longer give the

world

economic

we were

eyes

1994

304

.061

.20

our

delude
we

toward

391

33
26

.2420

.1745

10450 lbs.

which

avoided World War II.

wool.)

.0287

portant, by stockpiling these crit¬

nickel and silk.

times,
would
thinking
that

776 bis.

Y.)

fleeces)

would not be

com¬

328

4.90

$1439

Pa.

prices for ten-year periods before side of the Atlantic, are advocat¬
and after the war.
ing."
■'The basic idea is that the com¬
(The class 1 commodities which
modities
mentioned
are:
accepted
as
payment I
rubber,
tin,
in

1.46

.16

create any new wealth nor in it¬
self raise the standard of living
of
the
people.

consumed

„

cost more than

value

incurred in canceling the equiva¬

are

.5272

,164 lbs.

cost
something less than
billion in 1932 would today

$iy2

224

1.3909

1152 lbs.

(Kansas-Okla.—at wells).

will

amount

725

.225

1615 lbs.

scrap)

(96° centrifugal—N.

(Raw—Ohio

Total

1951

$36

.360

67 lbs.

destroyed

the average

and

these

and

Wool

$.653

the

clearly that to rely upon
gold for stabilizing the purchasing
power of money is a vain hope.
In addition, accepting this philos¬
ophy, proven to be false so many

91 lbs.

____

gold, which it had
but ultimately were
forced citizens to give up, from
without purpose there
$20 to $35 an ounce and made an
would be no greater loss than that

the annual consump¬
tion times the present price. The

and

value

economy

never

pres¬

ent value is

prewar

the

Even

of the last

average

real

Crude Oil

Sugar

$.0323

(Million $)

This

throughout

161 lbs.

pig—N.

prim.

of these commodities.

present time.
"Prices for standard grades of
the commodities are given in cents

(Desilvered

1110 lbs.

Y.)

(Electrolytic—N.

Aluminum

became involved in

the world and in¬

Lead

Value
1932

(Electrolytic—N. Y.)
((Raw—Japan 13/15)

Copper

1951

engaged

commodities

produced

volving problems

not

were

The

war.

Y.)

•

Total

(Jan.-July)
(Dollars/Pound)

(Million units)

sheets—N.

(Straits'—N.

Silk

though this

even

approximately equal quantity and
protected by tariff; and (3) Those
over

Tin

(Smoked

Nickel

class 2 and 3 would be very valu¬
able in
case
this country itself

A. in

time

outside

consumed

justified

Commodity and Grade—
Rubber

is very
apparent that a proper
supply of class 1 commodities
might be very difficult to obtain

Those
and

national defense

been
(1)

classes:

case

This position could be

plan must

They

at least semi-

of the country to be used
of a national emergency.

sources

r ;

Price per Pound

Average U. S.

objective.

money

time

the

average

(in

market

year's

Fall

value

consumption

these basic materials

$lJ/2 billion.

the

was

less than

Both the pre-World

War I and the post-World War I
values of these commodities

were

what

you

additional

information

have that makes you so

about the matter?"

sure

He answered,

"I just bought some sheep manure
for my lawn and paid 7c a pound
for it, and when rubber is half the

opinion the Treasury has often
negligent in administering

Actually, current American dol¬
amount

far

out

has

$35

per

abolish

the

gold
the

mo¬

United

States. Let the forces of competi¬
come in and
establish, in a

tion

true American way, a representa¬
tive price for industrial gold. This
new
price, based on the law of
supply and demand, will be realis¬
tic. Let's stop kidding ourselves.
This country has grown since

means

going and

better

to be used. This pro¬

better

greater produc¬

have

better

means

metal

was

Because the United States Gov¬
ernment

unemploy¬
prices, or rid
fallacy that the

price

gold

We have

was

with

ounce

Let
on

capacity;

how it

make

deflate this

can

the

1933.

the

in¬

falling
of

tive

where

come

structure
and

ourselves

sacred.

was

the

inventory of gold.

The time

nopoly

the
world

years

the

proportion to

basic choice.

credit

and

credit structure that

creased

ment

later

States
a

been

the

most

important

commodity and buyer of gold in the world, any
confidence money. While they no change in world price must be
lars

price.

erected

this program. It has sold too freely
without proper inquiry as to

price of sheep manure I am sure posed policy would conform strict¬
it's a buy."
A new kind of stand¬ ly to the letter and spirit of the
ard to measure values, but he was regulations
of the International
right.
Monetary Fund.
Basis of Value of American Dollars

that

United

transportation; we have
of communication,

schools, better hospitals,

better standard of
like

also

better
say

say

that

dollar, but

that is something

work toward. It will

of work

and

lot of effort.

living. I would
have

realist

we
a

all must

require

lot

lot of time and a

The Commercial and Financial Chronicle...

(1878)

low

Tomorrow's

stocks

the

Continued

cases
had their last
about ten months ago;

move

Markets

which

issues

priced

many

the

Whyte

war

began to appear signs of
weakness of quality stocks.

question, the market, reeling
its recent
blows, re¬

from

The
\

■

early end of the cold
apparently out of the

rfi

«r,:

had their last impor¬

groups

ago.

swered, however, is the pros¬ these stocks acute indigestion.
*

Looking back at these

Asking the question, "how
swami peering into
the future when actually the
feel like

murky mess I don't
anything about.

future is

groups for the last ten months
it looks as if they were under

kind

some

accumulation,
that

accumulation

now

to be

approaching com¬
know
*
*
*
pletion. If that's the case a
But if I don't know any¬ move of perhaps as long as a
thing about the future, the month, may start almost any
market by its recent action day.
indicates

number of inter¬

esting possibilities. And it is
such possibilities this column
will attempt to explore at this
time.

seems

On Chart III,
of

the daily numbers

traded

It is

our

vision

does start the leaders,

still

better

the

averages,

stocks

place the volume of vision
in the numerator, while

stocks

the

not

are

ac¬

also

realm

the

cepted leaders or the conven¬ possibility that a low priced
tional blue chips. They are the advance may be the forerun¬
ner of a major decline, though
calling attention to such a
possibility may be premature.
Pacific Coast
In any case you now have
two sides to the picture. What
Securities

will do about it remains
your business.
you

Orders Executed on

Pacific Coast Exchanges

|"The

Schwabacher & Co.
Established

this

1919

SECURITIES

York

New

York

Curb

Francisco

San

Stock

(Special to The Financial Chronicle)

Exchange

Chicago Board of Trade

the entire

period, thereby exclud¬

14 Wall Street

New York 5, N.

COrtlandt 7-4150
Private Wires to

Teletype NY 1-928

Principal Offices

Francisco—Santa

Barbara

Monterey—Oakland—Sacramento
Fresno—Santa Rosa

Hudson

become

have

Olas

Las

Boulevard.

event

did

recorded

until

occur

quick -collapse,

could

have

not

been

fore¬

Chart

III

begins

the

picturing

added

day

points to

finish at 210.

was

accompanied by a r^ise of the Ratio
of Volumes, reflecting the pre¬
dominance of disappointed specu¬

marked

by two small
bars. In order not
to clutter up the chart, and to
facilitate its reading, the inverted
are

point

had

cross

The

Ratio

period of the mar¬

scene.

Volumes

the

240

denominator

the

with

reversal

itself, and indicated
max.

the

market

selling cli¬
1

some

again

once

change
If

shall see
shift took place

the

that

low during the recent break, i.e.,

suggested

Chart II,

(

pre¬

this possibility was not excluded.

after

the volume of value stocks to total

fact,

actually

such

proved

Oct.

22,

the

percentage

volume

has been moving mostly
positive direction. In other
kettle boiling.
Once again, most words, since that time, the rela¬
of the fuel was provided by .vision tive volume of value stocks had a
stocks.
Beginning with the sec¬ tendency to expand concurrently
be the case.

But the market soon

made another

attempt to keep the

in the

ond

September,

with

half

indicated by Chart II, value

was

trary

producing
abundant
evi¬
dence of battle fatigue.
Still, in
the

course

October,

week

they made yet

half-hearted

stream

first

the

effort.

vision

following

day

began

full

Saturday trading may pre¬
distorted picture, and is not
completely comparable to normal

full-day sessions,
not
so,
an
a

plotted

this

point was

Chart III.

con¬

stocks.

see

trend-

this chart

mechanics

the

and

intermediate

the

disintegration

earlier

the

"Chronicle"

article

published
Dec.

the

course

1948.

30,

better performance of

The

described -in

moves

market

picture of a
cycle.
It con¬

good practical illustra¬

formation

the

the'summer

technical

intermediate

tion

two

final sessions of last week has not

Even

been
sufficiently conclusive
to
justify a conviction that a new
rising phase is already under way.

Friday's high stands out like
impressive summit—perhaps

neat

stitutes

331.

vision

advance.

Since

sent

rather

it jumped

true

was

building

that

stocks.

prices and to

almost to the level from which it

was

activity of trans¬

stock

a result, the Ratio of Volumes
pictured on Chart III declined

another
it

declines, while the

their
life
rapidly waning.
In

visible
was

But

rises

shrink

stocks

were

This coincided

the

decline

that

Friday,
Oct. 5, the Ratio of Volumes rose
to the unusual peak of 255.
The

once

indications,

some

in the character of trading. After
the averages touched their first

actions, they were far outdistanced

returned to the investment
The

are

industrials,

level, larger purchases of quality
stocks

seemed

the decline, began

Dow-Jones

approach

journey

subsequent
of

is sufficiently recent to need a
description.
But it is of greater
interest to note that already there
It

revert

terms of relative

course of

long

•'
sharp.

was

this

ted during the
ket's rise.
the

The ensuing decline

The peak reached at

July 9.
end

V.-

field.

Intermediate Cycles

cursory signs of a possible
in the speculative weather.

clearly

212.

rises of the Ratio have been omit¬

in the

certain

travelled

been

few

sufficiently elevated to mark
important buying climax.

May's highs to the bottom of

rises

had become a probability
high order; it was as close to
certainty as is possible in so un¬
of

jump of 100 points
preceding day's close,

the

high

the

Volumes

last June. This tail-end decline

parallel

market

the

not

On Sept. 6, the Ratio

It .is possible that the market may

i^st salute to the bull market.

yet have to face
CHART III

fore

If
the

Hudson

}

bull" market',

rising phase of the next inter¬

mediate

formerly with Daniel F. Rice
& Co. and prior thereto with Law¬
rence R. Leeby & Co.

was

still in

we are

selling be¬
cycle

intermediate

new

begins.

297 East

Mr.

recorded

umes

associated

with A. M. Kidder & Co.,

was

indicating thereby that the party
was
over.
The
timing of this

De¬

by the
Ratio from its low of 61 recorded

The Action of the Ratio

LAUDERDALE, Fla.—Rich¬
F.
Baldwin and George E.

ard

Volumes

road

ing random influences.

FT.

New York Cotton Exchange

San

Two With A. M. Kidder

Exchange
Exchange (Associate)

stocks

that

the selling of value stocks
growing, the Ratio of Vol¬

was

turned downward.

Stock

Effective

vision

steam

series of

the comparison remained at a fairly high level
which is thus carried out in terms throughout most of the following
of the same 100 stocks throughout week, ending it, on Sept. 14, at
character

ous

are

Members
New

began

September.

and

necessarily at any Ratio of Volumes started growing.
with those of the At the end of June, its numerical

They

Index -of

the

and

The

while

of
be¬

But

ginning with the second half of
both the Ratio of Volumes

from

presented as value exceeded that of the numer¬
ator, and, accordingly, the Ratio
of the author only.]

Chronicle.
those

INVESTMENT

not

coincide

time

expressed

views
do

article

mar¬

Ratio

declining.

was

the

July

the volume of value stocks forms

;!;

such

activity

the

propelling the final phase of the
advance was drying up.
With the
buying of vision stocks falling off,

stocks

that

the

Accordingly,

the denominator of thef Ratio, This
method gives a more homogene¬

do little of significance.
Though it is quite unlikely lative selling. To distinguish the
The significant thing about that the
rises of the Ratio occurring in a
averages will lie dor¬
falling market from its rises which
the current market is the type mant
during any advance in are coincidental with an
improv¬
of stocks that are slowly but a low
priced group.
ing price trend, they may be des¬
surely poking up their heads.
ignated as "inverted" rises.
On
Chart
Oddly enough the majority of
III, the Ratio's inverted
may

ket.

mand

are

likely that if such - last

even

move

exceed

specu*

advances, cast in advance.
directly to the
Nor
could
it
daily volumes of transactions in indicating a return of broader have been taken for granted that
public participation in stock mar¬ it
our value stocks, instead of com¬
would present itself in such a
ket activity. '
;
clear-cut manner.
puting their relative percentages
But once we
The real fireworks in the Ratio saw it
of total volume. To compute the
unfold, a break of the
stocks

the final phase of the descent from

value

Volumes

III,

about the future?" makes me

continued

striking illustration in Chart
III, which views the same statisti¬
cal picture from a different angle.
more

Ratio of Volumes shown on Chart

pects for the future.
*

market

the

transactions

denominator

Simultaneously, the

lative

period, the volume

speculative contingent of the

months

Coincidentally they ac¬
covered and has started to
quired a public interest and
climb back to higher levels. thereafter went into a hiber¬
The question still to be an¬ nation that
gave holders of

❖

condition

brief

pictured by Chart II finds an even

•

Most of the stocks in these

tant advance about 10

the

Ratio.

dwindled.
For

thus

panies and television outfits.

=By WALTER WHYTE=
An

Reasons for Recent Reversal

mail
orders,
dairies,
ship
builders, beer and liquor com¬

Says—

indefinitely linger at these exalted
heights.
The slowly but surely
mounting selling pressure laid its
heavy hand
on ' value
stocks,

swelling

taking in such widely
varied groups as the air lines,
range,

Walter

The Ratio of Volumes could not

from page 10

Outlook for Stock Prices and

Thursday, November 15, 1951

swing
to

averages

this

should

unlikely. I

seems

aw®

the

carry

highs.

new

inclined

to consider the intermediate cycle

which

SPECIAL

W. J. Mericka Adds

OPTIONS

CLEVELAND, Ohio—G. Thomas
•

Per 100 Shares Plus Tax

Studebaker

...

@30% Feb.

•

8 $262.50

Republic Steel.@42% Jan. 31 262.50
B. & 0...... .@20 "Jan. 28 137.50
Chrysler .....@67% Jan. 7 387.50
So. Pacific

.@61%
Chi.MiI.St.P.pf.@40%
Richfield Oil ..@57
Molybdenum. .@52
Schenley Ind..@33%

Feb. 15
Dec. 31

St. L.-San
So.

@55

Mericka

Commerce

Co.,

Inc.,

487.50

Dec. 31

137.50

Feb.

375.00

.@51

Dec. 26

Explanatory pamphlet

ELMIRA,
N. * Y. — RockwellCo.,
Inc.,
159-167
Lake
Street, announce that Mrs. Steph¬
anie Patterson of Owego, N. Y.

>1,

graphical

some

statisti¬

cal data derived from stock prices
and the activity of trading.
To

quote from

textbook of statistics

me some 25 years ago, or

more,

of time or

With Lester, Ryons
SANTA
Swanson

Ryons

ANA, Calif.—Charles A.
is
now
with
Lester,

Co.,

312

North

quite

research

Main

frequency series.

as
as

thoroughly
a

is
It

.It

tool of
method of presentaa

tion."

(Special to The Financial Chronicle)

Statistical' charting of this kind
an adjunct of scientific analysis.
has

little

common

with

the

"reading of the charts" in the Wall

Street.

Street

King Merritt Adds
(Special to The Financial Chronicle)

BENICIA,
uer

now

Calif.—Rae A. TheKing Merritt &

with

sense.

means

Co., Inc.

discussion.

charts-in

has been added to their sales staff.

THOMAS, HAAB & BOTTS
4, Tel. BO 9-8470

three
In

used

at. Harvard, "charting is
quite generally a preliminary or
.intermediate step in the analysis

request

Association, Inc.

[■

v •

used

Members Put & Calls Brokers <fc Dealers

Broadway, N. Y.

.■

Gould

price change
on

s.'

have

this

Exchange.

With Rockwell-Gould

Homest.

Subject to prior sale

form, they presented

200.00

Mng..@36% Feb. 2 287.50
Ariz.@24% Jan. 2 375.00
Beth. Steel ...@50% Dec. 31 237.50
U. S. Steel...@41
Dec. 26 137.50
Zenith Radio..@63
Dec. 31 475.00
Radio Corp.... @23% Jan.
7
87.50

have been just discuss¬

A Technical Pattern

Fr..@26%Jan. 11 250.00

Railway

Building, members of

the Midwest Stock

New Mex.

Union

362.50

Dec. 19

Tel.@16% Feb. 19 137.50
Woolen.@40
Dec. 31 237.50

Pure Oil

325.00

Int'l Tel. &
Amer.

become associated

has

with the sales department of Wm.

262.50

Jan. 11

Greenfield

ing as the first link in a chain of
coming downward adjustments of
stock prices.v■.■,-v:. • *'

1 So

interpretation, in the light

The

latter

usually

past experience, of patterns of
price behavior recorded on a chart.
I am-only superficially familiar
with this technique. But I believe
I am correct in saying that the

Number 5064

Volume 174

impressive.

quite

line

triangle

market technicians
"broadening top,"
of the basic reversal

what

passes

describe

which is

The broken
Chart I encom-

one

It will not become com-

patterns.

have
lows,

until the averages
through the June

pleted
broken

When such

breaktnrough occurs,

there

usually follows another deep
Until then, optimists will
surrender the hope that the

decline.
not

around, rise

market may yet turn
to

highs and leave the omi-

new

pattern uncompleted.

nous

■
•

The Economic Background

nnl

Tf
II

ttirn

lnntc
1UUKS

uue

"hrmHpninP
uiudueiuiig

thP
uie

itteif

i,,Qt

nnt

hot

conjunction

in conjunction with the Index of
Effective
Demand appearing oi
the

graph, it becomes diffi

same

rult to
hm^efuMnternrecult TnTi^e it a hopeful interpre
give
tation. Tn this connection our inIn
our

strikes

dex

S-

coXctton

tSinn

again

note.

a™,,t

Snnld
should

fitter
tiltei

before

Perhaps

nitM,,

with the corresponding quarters

—tbe"precedimf

England during the postwar mfla- security analysts Dr. William F. In the meantime, the emotional

0 But" once trends did 1920-becomeinflationary Edwards had the following to say nrnmispqof an election year that
tion until not
The evident in on the subiect:
climate to hp nartirnlarlv p-veitexpenditures trends did not become evident in on the subject:
promises to be particularly excit-

year

plant and equipment

begin to contract and the general stock prices until company earn- j «The priCe trends of reasonably ing is likely to bring in its wake
sure'that economic activity starts to recede, In|s ha.d begun to rise.
well-selected common stocks are sudden speculative movements,
sure tnat
atg
m
Earnings lose their influence probabiy controlled to the extent P o w e r f u 1 intermediate , rises

mpraw'

this

order to get eventually a larger
sum in depreciated currency.
!
Financial history confirms that
earnings continue to govern stock
prices in inflationary periods. The
classical example is that of the

Thus> they compared to the third in varying degree, the prices of Ina.r.ket..ana}yis,t leading analysts stage of the cycle, the application
should show an im®ri_the .f01!" of new governmental techniques
pr0~Vgm~e~~£
trary one of the
quarter even though they will their stocks diverged widely.
of security values. In an address will probably considerably soften
look unfavorable by comparison
The situation was similar in before a national convention of its contours and alter its rhythm.

pessimistic

nia^ce

it to
it to make

.onjjr if and of at least two-thirds by the gen- should interrupt the unfolding of
eral movement of stock prices, the basic downward trend. Marstudies of the proportion of com- ket analysis will try to locate
mon stocks that advance in price their inceptions and reversals un-

stock

we^know? tWs°indexisa"ratk>!? become

more marked. A new se- °»er
prices
of unfavorable comparisons wt>en inflation reaches the stage
will then descend upon corporate where the value of money is meltrni
;
>
ing so rapidly that there is a real
used as a mechanical gadget. Un- ea™mgs
The basic cyclical time series of ±light from the currency. If sound
comfortable as it may be, it is not
*£?=
•n-fitc id not the nnlv
to have iulcls„ currencies are
foreign
accessible
a robot which can give us dispenPW* downwards
to the public, they are the first
J
t1]rnPfi
In
fact
its
uie
die mc msi

its'me'anhTa

Therefore'
rathfMrather

romnlex

lt cannot be
It cannot be

simrde
simple.
simple

then
than

cuiicinjics

nnP

"vv

judgment.

: Like

the index re-

ratio,

any

flects the interactions of two facAs

tors.
it

little probing will show,

decline

can

Any
wSrbvat^bmrtHi assetsthat offer more^sohd value,
"
n'ri y
d
interest such as real estate> commodities,
rafpc;
Thorp
othor important and st.ocks» are other islands
of
PPOnnmir sories which
ran rea*inancial salvation from the flood
a

types

of the

occurs,

value

little
liuie

during the early
important rise when

in
in

the
uie

on
on

shattered

Rut
±5ut

sought

are

out

while vision stocks find

suDDort
support

still

Tnis usually

index.

stocks

investors

alongside and

even

inHcv

mil-

ticination

shouid

what^s li'kehfto
what
likely to

clicii

an-

disregard

its pa t.

inere are, °t course, still many
upwards. But this

•

even

emotional stimulant
inflation seems to

+0 e+nrk hnvint?

thousand economic ac-

skepticism

The

being

time

the

mpnt<; of

0.eing*. ine skepticism

1 a,tno"sana ec°VP??.ic, ,, expressed in this connection in
tjvltl®s ard' as B.urns and Mitchell the article 0j Aug 16 seems to

s?y
cles,"

"Maas""ng Business Cy- have been L.j
justified by events.
"will begin to face in ?
•

you

lJV-&111

vvlii

•ywu

As was slated previously in this

when

privilege of identimore the beginning of

the will have the

the propertne.propor¬

common

their ful1 com-Dlexity the timing discussion., the threat of sbo^+
rela«ons among the cychcal{he au_ ages is lessened or postponed until
move- s
men(s Qf actual ,ifeBut
»
»

Offered

stocks during

phase of decline in the stock

market, the probabilities, are at
least two out of three that the resuits will be unfavorable. Conversely, if in a rising market one
holds a reasonably well-selected
portfolio of common stocks, the
probabilities are at least two out

Should he Tmaeine a sta- L I
huying, mtiaiion seems^^to
1? ?.s } !npyld pe- imagine a sta be fadmg out 0f the picture for
tistical table showing the move-

This

thic

many

course

prove a passing
prove a passing

weakness

is certain to be worth less

oc-

would be then reflected in a strong
wuum ue uieiueiitLieuiiidbuuiij,
unciircfo

fact0rs pointing

exceed

theadvanceof'value stocks

pn„iri

price

$40,000,000 Detroit

When the cur" invested in

money-

fying once
tion of listed securities that make a new bull market,
ma j or tops and bottoms at approximately the same time, and the experience of large investment funds
all Support this conclusion. If fully
Edison Bonds

mate vision stocks will eventually
null

lif,al

spirit.

economic
economic

•

of
renc.y

decline

market is receding; of
marKet is receding; oi

Swiv^er^ Uiis list ^morrow and .probably nothing
th
{
hiyh f
oint the day after, stock yields and
lQf
^0st important of earnings lose meanmf Its a fl"
them alj viz
that of stock prices, nanaal sauve qui pent.
doubt '
should later have
1 ihat sucti a stage is unlikely to
t^coSider sudi inclusion be reached in: this country in any
Jy
inciusio visible future nardly deserves
T w are' of
still
elaborate demonstration. But

the
me

of
ui

nart
pan

speculative

favorable
tatoiaoie

a
a

fact,

phase of an

and most -popular refuge.

arp

is easy to imagine, for instance, a
highly bullish meaning for a declme

ear-

result of five

of relations between the factors in question. It
different

' rXH beenReceded

moment when, it

when the stock market is rising til the welcome
and

tion from the need for exercising

tistical sample of five stocks, or tive investors, the size and charincrease it to 50, or blow it up to acter of their holdings, the nature
500, we shall observe the same un- of their tax problems as well as
mistakable general movement. In the principles and objectives govtheir already mentioned book, erning their investment policies.
Board's latest analysis of the conBurns and Mitchell specifically I shall not irritate you by writing
sumer goods situation, as well as French inflation following World demonstrate that, for every cycle out a prescription for one and all.
other statistical data are all add- War I up to the Poincare stabili- in general business, there is a
Besides, those economic activing to the evidence that the basic zation of the franc.
Despite the cycle in stock prices and even in ities which have already turned
problem of the day is lagging de- substantial decline in the value of the number of shares traded. Not downward are still in the early
mand rather than shortages in the currency,-' as measured by its until we have more conclusive phase of the decline. And in the
supply.
fall on foreign exchange markets evidence that government inter- economy around them there are
It is probably true that the third and by the rise in the wholesale vention
can eliminate cyclical many elements of strength. Nor
quarter of 1951
will show the price level, the progressive depre- fluctuations can we neglect the should we underestimate the dyworst earnings picture for some ciation of the monetary unit was study of their effects on stock namic force of the defense protime to come. The coming quar- translated into stock prices only prices.
gram. The demand for goods and
terly earnings reports will no so far as it affected corporate
The importance of studying the services flowing out of military
longer have to cope with the prob- earning power.
And since com- general movement of the stock expenditures will keep business
lem of retroactive adjustments'for snheres of economic activity bene- market who well expressed by an active in wide areas for n many
panies engaged in different exnert. was is not a nrnfessinnal mnnths tn rnrr<P F.vnn at
onnniolc
later
insufficient previous accruals, spheres of economic activity bene- expert who is not a professional months to come. Even at a later

business of many corporations. Information recently published by
the Department of Commerce with
respect to manufacturers' unfilled
orders and the Federal Reserve

pattern of this year's market action
is

(1879)

The Commercial and Financial Chronicle

underwriting group headed
_

by Kuhn, Loeb & Co. is offering
$40,000,000 The Detroit Edison Co.
generai and refunding mortgage

bonds, series K, 3%% due Nov.
1976 at ioi.783 and accrued
interest. Other members of the
underwriting group are: Blyth &
of three that he will do well. Dur- c Inc . Union securities Corp.;
ing dynamic phases of the stock w »d ctnithpr*
Pn- Pari M
market
mirh a<? thn dpplinp^ of Woocl' otrhthers & U0.f. Carl 1V1.
market, sucn as tne aeciines ot Loeb, Rhoades & Co.; Fulton, Reid
1929 into 1932, the summer of
Au
1937 into 1938 and the less imiy^/ into iy.t» ana tne less im
pr0Ceeds from the sale of these
portant but more recent decline unn<qc. n,n,
nnnn J
in 1946, the influences affecting bonds will be applied toward the
company's construction program
in 1952.
The company has been
the stock market as a whole may
control the price trends of indi. ,
.
,
vidual common stocks to the ex- engaged for several years in maktent of 80% to 90%; or even ing extensive additions to plantfor
more."
™eet th? increasing demand to
15

Furthermore
not for practical its servicesGross expenditures
rhus°t^he'refore'^ view the index S10n, recession, Phafs of expan- 0thGr term of the far. At and retical grounds we also on aban- through the first nine mo^th^of
viewthe'Tridex t!,ouSh the f.our contraction and not materialized so money the reasons alone,'but cannot theomust
therefore
months ot
thors

against the economici background,
m g of 1951, there
has been no reason for investors

Since the begi

to hope for an economic improve-

abundant

sufficiently

ment

overflow

tne

revival will be found running side

by side at all times, the basic conception that emerges is that at any
time

one

to
and

margin

jmmecjiately that "al- advertised "inflationary can" has

add

one

Perhaps I

phase is dominant."
prejudiced by my

opinion concerning economic and
j

goods

deficits

are

the

por

balance

year,

the

of don lightly the use of conceptual

being whit-

devices.

Progress

knowledge

The accelerated defense

000,000.

Pr?gram and continued growth of
ordinary requirements will necesStatisitcs could not exist without jdate a continuation of additions

terrifying size, brings with it increasing use of
of the current generalizations and
abstractions,

^jed down to a less

fiSCal

prospects

the

relation,

enormous

Mills

law

has

piaced corporate taxes practically
1

the use of general trends or sum—

•

to Redemption
plant.

of the bonds

may

prices ranging fron.

that

assume

the ratio

the

weakness

has been caused by the

greater sensitivity of the marginal
concerns to the less favorable ecoconditions appearing on the

nomic

horizon?

views. But it does seem to me for the fiscal

that what

observe is

succes-

si0n 0f economic time series grad-

Ually
sion

bending
into

over

recession

parcel of a general

part

and

publication
mentioned

the two papers
at the beginning of this
Some of the then

discussion.

ex-

pected unfavorable developments
have since become accomplished
facts.

The

telling event in

most

this respect has been the appearance

of corporate

earnings for the

third quarter of the current year,

approximately 75%
reporting companies showed
declining profits after taxes. The

As you know,
of the

amounted to al-

average decrease
most 30%.
,

.y:<.

4;X^
✓

and the retro-

Higher tax

fea^^arrePf the new law.were
not tne

only reasons tor .this poor

quarterly

showing.

According

estimates

released jomtiy last
the Federal Trade Com-

month by

the

and

mission

Securities

and

Exchange Commission, net profits
before taxes of all

corporations
jn
a

manufacturing
shown already

the second quarter of this year

decline from the

And

ter.
it

had

seems

causes

was

clear

the

preceding

the

third

that

one

quar-

quarter,
of

the

shrinking earnings

decrease

in the volume of

expenditures, many
forward to a
within

range

Question of Inflation
Once

of estimates that is

cyclical peak, small in terms of
product.

The

statistical series happens to coinServing an area of 7,587 square
cide with this average, which miles with a total estimated pop
experts now merely
represents the typical ulation of 3,371,000, The Detroi
cash deficit value of them all? Conceptual Edison Co. is the only electric util•

1953, which is

from expan- i00k

There has been no improvement

in the economic outlook since the

year

likely to witness the peak military

vision
U.

One of the dominant influences

iucxiccc

And

if we

beyond the borders of the

A.,

may

well

developments in this country.

The Trend of the Stock Market
tionary periods, are caused by
It may be asked why we should
waves of speculative emotional- waste so much time and effort in
ism, not by changes in economic studying something that perhaps
might be does not exist. The general marbrought about by the expected de- ket is the sum total of all the
preciation of
the c u r r em c y. ; stocks traded in it. And we know
Changes in the purchasing power only too well from constant expemoney do not affect the bases rience
that many currents crissfor
valuation of stocks, which'cross its price formation surface.
continue, as always to be bound Individual stocks and stock groups
to corporate earnings.
Inflation of various classifications frequentmight be accompanied by a bear ly follow completely heterogenmarket if it produced conditions eous price movements and someunfavorable to profits; for exam- times even seem to be propelled in

fundamentals

that

pie, if costs, such as wages, rose
faster
or
further
than
selling

prices, as may easily happen, in a
controlled economy.
During in-1

diametrically opposite directions,
What is the point then of discussing a general price movement?

This is a good question. Closer
study, however, soon reveals that
earnings in depreciated currency despite the undeniable cross-curare
increasing.
But there is no rents, stock prices do move in
logical reason why one should pay overall general directions. Wheth-

flatlon the prices of stocks rise if

higher prices in sound money in

er we

take at random a small sta-

eternal
<.piw
PwtHr
imhtw
"Faust,"
selling electric lighting anc
culture.
power in the City of Detroit anc
*n extensive adjacent territory ir.

like the

Conclusion

wonder

whether measures recently taken
whether measures recently taken

causing
last
summer's
upward by the Bank of England and the
drive of stock prices was the fear Bank of France do not lend added
of inflation. However, spasmodic significance to earlier interest rate
stock market movements, which
sometimes occur during the inception of real or imaginary infla-

generalizations,

national "Mothers" in Goethe's
extend our are the guardians of our

gross

...

^lth^r an analysis of the trend
of the stock market nor a review
of economic conditions can help
us to answer with complete assurance whether the October break
was a mere passing incident in a
continuing bull market or the beginning of a significant downward
trend. But we can at least arrive
at an. informed opinion. In my
judgment, a marshalling of relevant facts by-the means of both
these approaches favors the probability that we have left the bull

anr

In addiCon-

sells to

comnanv

company sells to con
sumers Power Company all of the
tl0n>

electric energy requirements for
the Citv of Pontiac. The comnanv
,nn,

a^so conducts a steam-heating

business in the central business
secti0n of the City of Detroit
cprvirp k furnished in the

w t

vvacer service

City ,oi yassar.

xurnisnea in

Goodbody's Quarter
Century Dinner

market behind us.
For those who share this opinion, there is no single method for

using it as a guide for practical
operations. The attitudes of longterm investors for income and
sort-term traders for profit would
obviously differ and could conceivably stand at the opposite
poles of complete disregard and
strict adherence.
But between
these extremes there extends a
wide range of transitions v/hose
shadings are rendered even more
subtle by the infinite variations in
the types„ of individual or collec-

of Michigan.

the State

The New York Stock Exchange
A11C

firm

nnnrihndv

llf

broadway, New York City, established in 1891, will hold its Quarter Century Club Dinner tonight
1M

Mj,nhattan Ronrr

:of the New York Athletic Club

for the firm's 27 members. Marcus
Qoodbody will preside and present
,

members of

watcnes to inree new memo
the 25-year group.

Financial Chronicle... Thursday, November 15, 1951

The Commercial and
44

(1880)

statistical tabulations cover production and other figures for the^

The following

Indications of Current

latest week

week

Business Activity

month ended

STEEL INSTITUTE:
operations (percent of capacity)

steel

Indicated

Latest

and castings (net

Week

that date,

Ago

101.0

102.1

2,021,000

2,019,000

2,041,000

1,980,800

£tlH~s—dally

to
Gasoline output
Kerosene output (bbls.
Distillate fuel oil output
runs

URBAN

TION
U.

(000's omitted):
building construction—

6,117,000

22,057,000

22,364.000
2,573,000

21,446,000
2,656,000

2,309,000

9,380,000
8,433,000

9,329,000

8,747,000

8,330,000

8,500,000

2,737,000
9,226,000

8,792,000

LABOR—Month
Total

of cars)

111,120,000

112,703,000

104.350,000

33,541,000

29,115,000

New

102,106.000

86,886.000

Additions

102,926,000

33,704,000
98,198,000

49,168,000

47,966,000

44,911,000

837,743

863,961

858,750

863,149

696,496

708,620

709,524

723,309

48,570,000

construction

Public

$220,702,000
108,463,000

73,832,000

69,464,000

Nonhousekeeping
Nonresidential building

54,267,000
19,565,000

53,602.000

86,234,000

15,862,000

26,005,000

$159,525,000

—

...

1,145

93
16

390

451

382

202

112

100

136

—

(nonfarm)—_

JJ0V*

—

52,924,000

9,161,000

134

108

130

353

institutional

and

utilities

Railroad

149

construction

Public

130

recreational-

and

Miscellaneous
Farm

v,/:; '>>

358

294

■

Hospital

39.831.000
62.085,000

building

nonresidential

Social

Warehouses, office and loft buildings.
restaurants, and garages

Stores,

$101,916,000

112,239,000

Nov

municipal

and

State

85,693,000

$209,778,000
140,314,000

Nov

'
'

825

units.
and alterations—

Educational

construction

Private

1,247

830

336,375

dwelling

Other

construction

Total U. S.

2,025

934

Industrial

.Nov.

RECORD:

$2,773

1,879

:
(nonfarm)

building

Residential

109,513,000
33,522,000

ENGINEERING NEWS-

ENGINEERING CONSTRUCTION —

$2,837

DEPT. OF
millions):

S.
(in

October

construction

Private

Religious
•UVIL

115,437

1,789

construction,..

new

Commercial

ASSOCIATION OF AMERICAN RAILROADS:
Revenue freight loaded (number of cars)—
Revenue freight received from connections (number

102,660

933

etc

CONSTRUCTION- U.

BUILDING

.Nov.

oil (bbls.) at
fuel oil (bbls.) at

650,625

224.331

100,190

—.

376,217

177

alterations,

Nov.
JJJJJNo.
-Nov.

at—

$1,102,437

401,779
253,957

———

*—

20,156,000

•

Distillate fuel
Residual

6,536,000

•

(bbls.) at

Kerosene
•

6,461,000

^ov.

(bbls.)

unfinished gasoline (bbls.)

and

Additions,

6,337,600

116,543,000

gBB& 'refinerle°sU atUbulk terminals, in transit and In pipe linesFinished

5,888,900

nonresidential

6,339.900

—

$2,692

residential

New

6,287.800

Nov

$703,258

LABOR —Month

DEPT.

August
All

(bbFs.)

average

Ago

PERMIT VALUA¬
AREAS OF THE U., S.

New

Crude

Year

Month

CONSTRUCTION

BUILDING

102.7

date:6.

$755,926

Ago

—

(bbl, of

of that

are as
Latest

Nov. 18

average

of quotations,

cases

Month

101.1

tons)

or,

Year

Month

-Nov. 18

Equivalent to—
Bteel ingots

Week

/450EB1CAN IKON AND

Dates shown in first column are either for the

month available.

—

29
23
..

30
12

■

Federal

OUTPUT (U. S. BUREAU OF MINES):
coal and lignite (tons)
Pennsylvania anthracite (tons)
Beehive coke (tons)

OOAL

11,315,000

♦11;565,000

10,865,000

Other

1,086,000

981,000

583,000

♦136,600

139,900

158,600

wov* 3

other

All

11,535,000

673,000

143,500

Nov. 3
Jjov. 3

Bituminous

public
private

construction

Public

RESERVE SYS-

Nov

TEM—1935-39

—

INSTITUTE:

MDISON ELECTRIC

Industrial

327

348

318

315

7,396,115

Nov. 10

7,319,019

7,360,380

6,574,084

STREET, INC.

143

150

126

lb.)

Pig iron

—

4.131c

4,131c

3.837c

Nov.

—r--

$52.72

$49.69

Export refinery at

$42.00

$43.00

$41.67

Nov.

——..—.

Dead
Zinc

i——Nov.
Nov.

—

24.200c

All

27.425c

24.425c

103.000c

of Sept.

19.000c

17.000c

18.800c

16.800c

19.500c

17.500c

Government Bonds

Aa
A

Baa~_I

Railroad Group

Utilities

Public

Group

98.03

and

111.07

115.43

Ice

115.63

119.61

House

115.04

118.80

108.88

109.97

—

corporate

Average
Aaa

103.30

103.47

104.31

109.06

105.86

107.80

111.62

109.42

110.07

113.70

114.66

Baa

—1

—

Railroad

Group
Public Utilities Group

Industrials Group

2.65

2.63

3.19

3.11

2.88

2.96

2.87

(DEFT.

—

157.8
210.8

194.2

165.4

157.8

COMMERCE):

to Oct.

S.
as

500-lb.

2.90

2.71

3.23

3.24

3.17

2.92

3.55

3.54

3.49

3.22

3.40

3.29

3.08

3.20

3.11

2.86

3.20

2.96

2.97

2.92

2.70

461.4

458.0

461.3

COTTON

SEED

488.1

2.95

—

DEPT.
of

4,869,675

8,339.303

18
OF

Nov.

15,771.000

16,931,000

10,012,000

1,053,658

bales

gross

COTTON

AND

UCTS—DEFT.

SEED

♦555,350

599,914

PROD¬

COMMERCE—Month

September:
Cotton

Seed—

mills

Received

Crushed

(tons)

Stocks

(tonsi

541,257

Sept.-30

(tons)

♦199,371

403,932

934,861

—

*422,460

471,919

Oil-

Crude

(pounds)

Produced

COMMODITY INDEX—

148.1

166.0

PRODUCTION

Stocks

MOODY'S

96.9
196.1

157.8

Running bales (excl. of linters)

2.67

3.01

97.3
204.2

2.37

3.19

Nov: 13

—

189.8
131.8
141.2

211.1

furnishings

GINNING

COTTON

2.66

13
13
13

144.2

119.00

3.01

Nov.
_Nov.
Nov.
Nov.
Nov.
Nov.
Nov.

;

185.4

115.82

113.89

Nov. 13
13

—

136.8

154.8

188.3

203.6

114.66

105.86

Nov. 13

162.7

327.3

97.3

_______

____

—

Production

MOODY'S BOND YIELD DAILY AVERAGES:
U. S. Government Bonds
;————

345.2

204.9

AGRICULTURE—Estimates

Industrials Group

192.1
186.0

144.4

Miscellaneous

108.70

186.9

208.9

137.5

fuels

113.89

225.8

209.0

electricity and refrigerators
and electricity

112.93

260.2

205.9

188.2'

109.60

276.6

! y

161.5

sweets..

Other

206.4

176.9

345.0

oils

210.0

205.1

Rent

174.6

239.3

vegetables

and

Clothing

101.63

183.7

277.6
-

_______

114.08

Nov. 13
Nov. 13

„

227.0

189.4- •:/■

products

112.93

Nov. 13
Nov. 13
Nov. 13
Nov. 13
_Nov. 13

97.72

109.60

Nov. 13

—
-

—

97.59

135.5

227.3

bakery

and

Sugar

Gas

Aaa

7 /V

186.6

products

Fruits

Fuel,

Average corporate

15:

...

foods

Beverages
Fats
and

151.000c

19.000c

MOODY'S BOND PRICES DAILY AVERAGES:
JJ. 8.

CITIES—

LARGE

Eggs

24.200c

103.000c

7
7
7
7

Nov.

24.200c

27.425c

Nov.

(East St. Louis)

24.200c

—iui—Nov. ■ ,7

—.

MODERATE

FOR

FAMILIES

items

Dairy

York) at—

265

€

INDEX

PRICE

Cereals

"Vi

(New York) at
(St. Louis ) at

Dead

275

Btraits tin (New

public-service enterprises
development

and

Meats

Electrolytic copper—
Domestic refinery at—

120

water

1935-1939= 100—Adjusted
All

(E. & M. J. QUOTATIONS):

METAL PRICES

49
35

127

public

INCOME
Nov.

PRICES:

COMPOSITE

115

N0Vl 0
CONSUMER

Finished steel (per

136

125

235

other

All

135

247

;»■

and naval facilities

and

Sewer

103

'•

building

Highways

Conservation

INDUSTRIAL)—DUN & BRAD-

...

65
323

106

—

institutional

nonresidential

Miscellaneous

(COMMERCIAL AND

310

•

748

953

903

—....

Hospital and
Other

(in 000 kwh.)_

output

♦BON AGE

39
223

—.

building

Nonresidential

Military

CrULCRES

283

;*5

building

Residential

Educational

STORE SALES INDEX—FEDERAL
AVERAGE = 100

♦ IEPARTMENT

Electric

278

•

telegraph
utilities

and

Telephone
/

90,010,000

63,370,000

60,200,000

121,868,000

44,582,000

93,241,000

102,715,000

98,103,000

30
.

(pounds)

Shipped

29,133,000

166,505.000

102,211,000

Sept.

(pounds)

Refined Oil—

Stocks

RATIONAL PAPERBOARD ASSOCIATION:

Nov.
Nov.
Nov.

Orders received (tons)

Production

(tons)

Percentage of activity
Unfilled orders (tons).at end of period

Nov.

3
3
3
3

184,971

297,394

287,590

207,910

203,278

215,312

102

487,788

402,751

528,885

774,891

PAINT

DRUG

AND

AVERAGE

PRICE

REPORTER

INDEX —1926-36
Nov.

100

Stocks

149.0

148.9

138.4

(pounds)

40,499,000

85,825,000

97,735,000

116,937,000

57,343

70,841

Sept. 30

(tons)

Produced

149.1

EXCHANGE—SECURITIES

Stocks

(tons)
(tons)

180,934

148,635

18,914

82,470

119,904

44,104

93,436

115,361

45,347

83,931

94,982

Sept.

51,557

23,457

(tons)
(running bales)—

Stocks

Sept.

Oct. 27
Oct. 27

Number of orders
Number of shares

Oct. 27

29.815

35,054

1,016,076

867,872

$45,120,076

$37,739,448

1,058,610
$44,640,123

42,697

33.621

1,224,443
$53,842,025

Sept.

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales
short

Customers'
Customers'

other

Oct. 27

32,333

35.784

971.059

903,857

753,464

1,044,301

Oct. 27
Oct. 27
—Oct. 27

other

17,049

8,600

5,046

10,451

954.010

895,257

748,418

$41,923,238

$30,723,051

$40,534,080

Dollar value

sales

;

265,550

296,670

216,000

326,910

265,550

296,670

216~000

3~26~910

Dct. 27

1926

100:

Oct. 27

;

SERIES— U.

PRICES, NEW

^WHOLESALE

•

Stocks

487,220

353,150

320,350

347,990

All

manufacturing

Durable

AH commodities
Textile

other than farm

and

Fuel and

Building

lighting materials
materials
"

Lumber
Chemicals

•Retfsed.

and

allied

products

tNot available.

1__

goods

12,794,000

♦7,243,000

6,891,000

♦5,667,000

5,903,000

159.7

♦157.6

156.3

431.3

*424.1

391.4

16.010,000

►15.837,000

15,450,000

8,885,000

•8,859.000

8.294.000

7,125,000

—

►12,910,000

7,271,000

5,809,000

(production workers)

—i

goods

♦6,978,000

7,156,000

—

Estimated number of

177.0

177.4

170.4

193.3

192.1

193.1

181.2

189.5

185.1

172.6

246.7

247.6

257.2

225.5

Durable

189.9

191.3

172.5

282.1

285.1

employees in manufac¬

All

237.

177.2

turing industries—
manufacturing

165.3

165.1

158.1

♦157.0

157.1

,164.

138.7

138.8

138.9

135.

General

\jov,

Nov.

{Includes 486,000 barrels of foreign crude runs.

165.0

163.0

190.9

180.

223.9

223.8

223.2

345.6

344.5

140.7

140.9

134

■—:<■

goods —;

STATES GROSS DEBT DIRECT
GUASANEED—(000's omitted)

UNITED
of

October

AND

•

■

$258,335,674 $257,386,206 $256,958,761
4,873,884
6,916,361
4,145,258

216.

346.6

goods

Nondurable

279.2

Nov.
Nov.
Nov.
Nov.

Metals and metal products

13,080,000

S. DEPT.
SERIES—Month of

manufacturing

Nov.

foods

products

1,195

Employment indexes—

Nov.

Meats

2,264

AND PAYROLLS—U.

LABOR—REVISED

Nov.

„

....

961

1,364

August:

Nov.

Grains

Livestock

2,645

2,463

;—

EMPLOYMENT

191.3

Nov.

..Nov.

products

639

3,634

4,144

Shipped

190.1

Farm

969

(.1,000 pounds)—

Payroll indexesAll manufacturing

•

AH commodities

etc.

Produced

All

OF LABOR—

S. DEPT.

1,451

1,953

Sept.

Nondurable

purchases by dealers—

Number of shares.

Oct. 27

Other sales

Bound-lot

——

Motes, Grabbots.

Bound-lot sales by dealers—
Number of shares—Total sales

t344
t,

1,033.850

$38,304,868

-Oct. 27

sales—

111,885

1.606

Shipped

276

26,476

sales

Short

239

30,933

sales

short

Customers'

532

149

Oct. 27
Oct. 27

Customers'

36,060

Oct. 27

sales

Number of shares—Total

31,172

32,865

26,625

132,329

50,467

818

Produced
,

•

(1.000-lb. bales)—

Fiber

Stocks

132.048

—:

72,009
*

63.81.9

175,473

Shipped
Hull

—

Produced

purchases)—

Dollar value

(tons)

Shipped
Linters

COMMISSION:

EXCHANGE

by dealers (customers'

Odd-lot sales

153,478

92,222

106,524

Hulls-

Produced

250,122
236,624

(tons)

;

QTOCK TRANSACTIONS FOR THE ODD-LOT ACCOUNT OF ODDLOT DEALERS
AND
SPECIALISTS ON THE N. Y. STOCK

73,621,000

96,085,000

100,550,000

and Meat—

Cake

Shipped

OIL.

30—

Sept.

(pounds)

Consumption

236,142

(pounds)

Produced

321,394

190.9

Net

fund

balances—

Computed

$252,813,503
2.201 ft

2.310%
tNot shown to avoid disclosure of Individual operations.

annual rate

•Revised figure.

$253,461,790

$250,469,845
2.283%

debt
._

—

yolume 174

Number 5064

The Commercial and Financial Chronicle

Securities
New Registrations and
>j;

Almadon-Santa

Clara

Nov.

Vineyards, San Francisco,

lative

(letter of notification)

share).

per

3,000 shares of $6 cumu¬
Price—At par ($100

convertible preferred stock.

Underwriter

Wagenseller

Durst, Inc.,
Los Angeles, Calif., and Hooker & Fay, San Francisco,
Calif. Proceeds—For working capital. Office—37 Drumm
St., San Francisco, Calif.
—

American Bosch Corp., Springfield, Mass. (12/4)
13 filed 65,450 shares of second preferred stock,

Nov.
1951

series,

offered

stockholders

common

record Dec, 4, 1951, at rate of one share of preferred
each 20 common shares held.
Price—To be

amendment.

Underwriter

Allen

—

for

supplied by
New York.

Co.,

Proceeds—For working capital.
Assured

Investment Co. of Chickasaw

(Ala.)

Nov. 9 (letter of notification) 950 shares of 6% cumula¬
tive preferred stock (par $100) and 950 shares of common
stock

(par $10)

be offered in units of

one

preferred and one share of common stock.
per unit.
Underwriter — None.
Proceeds
capital.
\
'
'

Price—$120

—

To increase
■

St., Cambridge, Mass.

Centra!
13

Hudson

filed

Drexel & Co. and Stroud & Co., Inc.
(jointly).
refund short-term indebtedness and for
struction. Offering—Scheduled for

—To

Proceeds
new

Life

Insurance Co.

Missouri

Nov. 6

(letter of notification) 20,000 shares of common
stock
(par $10).
Each purchaser will be required to
transfer back to the company one-third of the number
of shares so
purchased, such shares so returned to be
used to obtain the guaranteed life funds certificates of
Commercial

Life

set

forth

the

$15

per

the State of

for

use

Co.

Springfield, 111., as
subscription agreement.
Price—
Underwriter—None.
Proceeds—To be

stock

share.

deposited

Insurance

reserve

with the Division of Insurance of

Missouri, of which $100,000 will be available

for corporate

Offering

purposes.

wholly within the State of Missouri.
St., St. Louis, Mo.

^Consolidated
Calif.

Nov.

—

To be made

Engineering Corp,,

Pasadena,

(12/3)

outstanding.
Price—To be supplied by amendment.
Underwriter—Blyth & Co., Inc.
Proceeds—To retire
working capital.

held; rights to expire Dec. 18.
&

Price—To be supplied by

Underwriter—Merrill Lynch, Pierce, FenProceeds—For expansion pro¬

Bean, New York.

gram.
Gulf

Screen

additional

derwriter—Van

Corp., New York.
Pro¬
and for work- '

Noel

Alstyne

Offering—Expected early in December.

ing capital

Nu-Enamel

1, 1959.

notes, dated Dec. 1, 1951, and due Dec.

Price—

(in denominations of $100 each). Underwriter—
capital. Office—444 Lake

At par

Proceeds—For working

None.

Shore Drive,

Chicago, 111.

Nursmatic

Wire

Co., Inc., New Orleans, La.
Nov. 9 (letter of notification) 5,000 shares of common
stock.
Price—At par ($10 per share).
Underwriter—
None.
Proceeds
For
equipment.
Office —2344
St.
Charles St., New Orleans, La.
-

Corp.,

for working capital.
Chicago 6, 111.

(letter of notification)

ferred and
unit.

one

share of

common

Underwriter—None.

stock.

Price—$100

Proceeds—To

pay

per

debt and

for working capital.
Office—Indian Rocks Road
Box 327), Indian Rocks, Fla.

Cement

Co., Denver, Colo.
Nov. 9 filed 250,000 shares of capital stock
(par $10) to
be offered in exchange for shares of $10
par stock of
Cement Co. of San Francisco on basis
share of Ideal for each two shares of Pacific stock.
Offer is subject to condition that 80% or more of Pacific *

outstanding stock must be tendered in exchange for Ideal
If exchange offer is
consummated, it is Ideal's
intention to operate the Pacific
company as a subsidiary.
stock.

Pittsburgh Coke & Chemical Co.

pJov., 7 (letter of notification)
stock

(par $1), to be offered to

filed

Price—To

40,000

8,060
a

shares of

ceeds— To

Price—$25.07 V2 per share. Underwriter—None.
Proceeds—For general corporate purposes.
Office—919
North Michigan Ave., Chicago
11, 111.
Lau Blower Co.,
Dayton, O.
Nov, 13 filed 160,000 shares of common

stock

(par $1),
of which 147,250 shares will be offered
publicly and
•12,750 shares will be offered directly to employees and 1
others identified with the
company's business.
Price—
To be supplied by amendment.
Underwriters
A. C.
Allyn & Co., Inc.; Chicago, 111., and Bear, Stearns & Co.,
New York.
Proceeds—To certain selling stockholders..
—

Jackson

common

stock

amendment.

capital.
the pro¬

Curtis,

(par $2).„

Underwriter—

Boston,

certain selling stockholders.

Mass.

Pro¬

Office —New

Bedford, Mass.
Air

Reduction Co.,
filed

ferred

stock,
subscription by

at rate of

held;

one

Inc., N. Y.

248,805 shares of 4.50% cumulative pre¬
1951 series (par $100) being offered for
common

stockholders of record Nov. 2.

preferred share for each 11

common

sharer*

with

rights to expire Nov. 19. Price—$100 per
Underwriters—Morgan Stanley & Co. and Har¬
riman Ripley & Co., both of New York. Proceeds—For
share.

Electric

Products,

Inc.

■■

;

■

(N. J.)

Public

New

supplied by

Service

Co.

New

(letter of notification) 6,200 shares of commoa
(par $2). Price—At market (about $16 per share)..

Underwriter—None.

amendment.
Underwriter—
Hemphill. Noyes, Graham, Parsons & Co., New York.
Proceeds—For expansion program.

York.

Brake Shoe

Hampshire

Kidder, Peabody & Co. and Blyth &
Co., Inc. (jointly); The First Boston Corp.; Harriman
Ripley & Co., Inc. Proceeds—To reduce short-term bor¬
rowings and for construction program.
Offering—Ex¬
pected late this month or early December.
Queen City Fire Insurance Co.

stock purchase plan.
Price—To be not greater than
the market price on the date of the offering, or no lest*
than 85% of such price. Underwriter—None. 'Proceed*!

.—To be added

general funds.

American Investment Co.

Corp., Chicago, 111.

Corp., Salt Lake City, Utah

common

stock

Domestic

Finance!

Statement effective Sept.

—

-^American-Marietta Co., Chicago, III.
Nov.

Corp., Boston, Mass.
182,196 shares of common stock (no par).

Price—At market.

Underwriter—None.

Co.,

Proceeds—For

Technical

Operations, Inc., Boston, Mass.
(letter of notification) 78,750 shares of common
stock *(par 10 cents).
Price —$2.75 per share.
Under¬
writer—Walter J. Connolly & Co., Inc., Boston, Mass.

Nov.

laboratory equipment and working capi¬

Fisher.

for farm

Price—$20

share.

Proceeds—To level and

equipment.

12,500 shares of

common,

& Nichols Co., Oklahoma City, Oktau.
Davidson, Hartz, Hyde & Dewey, Inc.,
Madison, N. J.
Sept. 27 filed $2,000,000 of contributions in oil property
interests (1952 fund) in amounts of $15,000 or more.
Underwriter—None. Proceeds—To acquire and develop
oil property. Statement effective Nov. 1.
and

Underwriter—

Blair

(Neb.) Telephone Co.
18 (letter of notification) $175,000 of first mort¬
gage 4% bonds, series A, due 1971. Price—101 and ae-

clear land and

July

Address—Box 765, Tempe, Ariz.

Virginia Electric & Power Co.

Insurance Co.

Blackwood

12,500 shares of common
per

Fire

(letter of notification)

($10 per share). Underwriter—None. Proceeds—To
enlarge insurance business. Office—221 No. 21st St., Bir¬
mingham 3, Ala.

Farms, Inc., Tempe, Ariz.

(par $10).

par

Thermoid

Willard

Chicago, 111. Proceeds—To 18 selling stock¬
Offering—Expected week of Nov. 26.

stock, to be offered to stockholders of record Nov. 15 at
rate of one share for each seven shares held. Price—At

Office—16 Court St., Boston, Mass.

(letter of notification)

(11/26-28)1

48,634

Birmingham

Nov. 9

Proceeds—For

filed

Inc.,

holders.

investment.

United

shares of common stock (par $2>
and 7,779 shares of 5% cumulative preferred stock (pan'
$100). Price—To be supplied by amendment. Under¬
writers—H. M. Byllesby & Co., Inc., and A. C. Allyn &:

State Street Investment

Nov. 8 filed

Nov.

for

Co., New York, and Alex. Brown & Sons, Baltimore^.

Md.

Office—426 Felt Bldg., Salt Lake City,
Utah, and Box 246, Preston, Idaho.

stock

exchange

basis of one American share for
each five Domestic common shares; the offer to expire*
on
Sept. 30, 1952. Dealer-Managers—Kidder, Peabody

(letter of notification) 90,000 shares of common
Price
At par ($1 per share).
Underwriter —
Proceeds—To finance construction of plant and

None.

tal.

of Illinois

Aug. 16 filed 167,105 shares of $1.25 cumulative convert¬
ible preference stock, series A (par $25), being offered,

(par $100) to be offered to stockholders of record about
12.
Price —$400 per share.
Underwriter— None.
Proceeds—For working capital. Office—Sioux Falls, S. D.

stock.

Co.

Probable bidders:

Soil-Aid

Street, Springfield, Mass.

June 29 filed 50,000 shares of common stock (no par) t£«
be offered to certain officers and key employees through

235,809 shares of common stock (par $10).
Underwriter—To be determined by competitive bidding.

Nov. 5

Proceeds—To F. William Harder o&

Office—Main

American

Nov. 9 filed

(12/11)

Continued

filed

$20,000,000 first and refunding mortgage
bonds, series I, due Dec. 1, 1981.
Underwriter — To be
determined by competitive bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Stone & Webster Securities

page

Corp.; White, Weld & Co.; Union Securities Corp.; Salo- 1

common

selected group of em¬

working

approved

(11/20)

shares of

supplied

Paine, Webber,

stock

(no par—convertible up to and including Dec. 31, 1961).
Price—To

Bros.

penditures.

ployees.

Acushnet Process Co.
Nov.

Oct.

(12/3)

Nov. 13 filed 60,000 shares of convertible preferred stock

mon

Products Co.

and
13

•.!

Pennsylvania Salt Mfg. Co.
Oct. 25 (letter of notification) 14,000 shares of commoE
7 filed 88,467 shares of common stock (par $10) f stock
(par $1) and $250,000 of three-year convertible*
exchange for common stock of Sharpies
6% notes.
Price—For stock $3.50 per share and for
Chemicals Inc. on basis of 5.15 shares of Pennsylvania
notes
afc
100%.
Underwriter—Hill, Thompson & Co.*.
Salt stock for each Sharpies share (conditioned upon
Inc., New York. Proceeds—For working capital. ;
deposit for exchange of at least 13,748 of the 17,184 out¬
American Bosch Corp., Springfield, Mass.
standing shares of Sharpies stock). Underwriter—None.

Pacific Portland
one

Nov.

to be offered in

Office —1017
,

expenditures

issue.

Nov.

Nov. 5

Cellucotton

new

Allied

Proceeds —To six selling stockholders.
.Walnut St., Des Moines 9,. Ia.

cumu¬

lative preferred stock (par $50).

International

capital

Meeting—Stockholders
posed

expansion program.

(P. O.

Price—At market (cur¬
rently $50 per share).
Underwriter—Probably Quail &
Co., Davenport, la., and Becker & Cownie, Des Moines, la.

Hawkeye-Security Insurance Co.
(letter of notification) 2,000 shares of 5%

Nov. 5

Price—To be supplied by amendment.
Underwriter—A. G. Becker & Co. Inc., Chicago, 111. Pro¬
ceeds—For

Oct.

Co., Trenton, N. J.
Nov. 7 filed memberships in the Employees' Thrift Bonus
Plan and shares of capital stock (preferred or common)
to be offered to 1,500 Thermoid employees.
The maxi¬
mum number of shares of preferred and common stock
which may be purchased by the Trust will not exceed
16,500 and 60,000, respectively.; Underwriter—None.

106,851 shares of 4% cumulative preferred
stock (par $100), convertible into common stock
prior to»
Jan. 1, 1962, to be offered initially for
subscription by
common stockholders of record Nov.
16 at rate of one
preferred share for each 35 common shares held; rights

Office—400 West Madison St.,

Gardens, Inc., Indian Rocks, Fla.
2,990 shares of common
sfock (par $20) and 11,960 shares of 5% preferred stock
(par $20) to be issued in units of four shares of pre¬
Nov.

(11/16)

Oct. 25 filed

Underwriter—None. Proceeds—To retire bank loan

and

—

Ideal

^Abbott Laboratories, Chicago, III.

Chicago, III.
Nov. 7 (letter of notification) 9,200 shares of preferred
stock (no par—stated value $20 per share) and 18,400
shares of common stock (no par—stated value 35 cents
per share), to be offered in units of 20 shares of pre¬
ferred and 40 shares of common stock.
Price—$514 per
unit.

ADDITIONS;

will expire Dec. 3.

III.

Chicago,

Corp.,

(letter of notification) $220,000 of 5% convertible

Nov. 8

for equipment.

Ferro Corp., Cleveland, Ohio (12/3)
13 filed 91,859 shares of common stock
(par $1) to
be offered for subscription by common stockholders on
or about Dec. 3 at rate of one share for each
five shares
amendment.

ceeds—To nurchase additional equipment

Nov.

ner

with

together

INDICATES

Previous Registrations and Filings

(par $1)

stock

Nov.

stock issuable upon exercise of warrants
presently

and for

public,

Hartford, Conn.

common

Nov. 5 (letter of notification) 500 shares of common stock

notes

shares ot

90,000 shares reserved for issuance upon the exercise of
Price—To be supplied by amendment.
Un¬

Office—3908 Olive

filed 125,000 shares of common stock
(par 5(>
cents) to be offered to public and 14,030 shares of com¬
mon

warrants.

con¬

early December,

Commercial

400.000

offered

•

Gas & Electric Corp.
(12/3-8)
40,000 shares of cumulative preferred
stock, 1951 series (par $100). Underwriter—To be sup¬
plied by amendment. If competitive, bidders may in¬
clude
Kidder, Peabody & Co. and Estabrook & Co.
(jointly); W. C. Langley & Co.; White, Weld & Co.;

Nov.

Laboratories Corp.,

filed

PaEm

Badger Manufacturing Co., Cambridge, Mass.
Nov. 5 (letter of notification) 17,500 shares of common
stock
(par $10). Price—$15 per share. Underwriter—
None, but sales will be handled by H. W. Cooms, E. I.
Clapp, R. W. Carlson and C. L. Campbell, all of Cam¬
bridge, Mass. Proceeds—For working capital. Office—
230 Bent

* REVISIONS THIS WEEll

Registration

Norden

Filings

;California

Nov.

Now

(1881)

Hutzler.

Proceeds

Wisconsin Central Airlines,
Nov.
stock
to

—

For construction

Bids—Expected to be opened

(letter of notification)

ex¬

Dec. 11.

Inc.

61,667 shares of common

(par $1), of which 51,667 shares are to be offered
on a one-for-three
basis, with an over¬

stockholders

subscription

privilege; the remaining 10,000 shares are
to be offered to employees.
Price—To stockholders and
employees 25 cents per share below closing price on date
of offering.
Underwriters — Loewi & Co., Milwaukee,
Wis.; Blunt, Ellis & Simmons, Chicago, 111.; Bell and
Farrell, Inc., Madison, Wis.;'Dayton & Gernon, Chicago,
111.; Straus & Blosser, Chicago;1 and Braun, Monroe &
Co., Milwaukee. Proceeds—For working capital and for
purchase of additional radio equipment.

Boston

New York.

Philadelphia

Pittsburgh

San Francisco

Private Wires to all

offices

Chicago

Cleveland

46-

The Commercial and Financial

(1882)

Continued

from

until June 1,

Underwriter

interest.

crued

time
Price
Underwriter—None.
Statement effective
X'
XXX'X''/. XX

Corp.,

Wachob-Bender

—

—55

Rights will expire on Nov. 30.

1953.

share—Canadian.
capital.
Nov. 5.■
; '/• '■
cents

per

Omaha, Neb. Proceeds—To retire first mortgage (closed)
3%% bonds and to convert to dial operation.

Proceeds—-For

Burlington Mills Corp.
March 5 filed 300,000 shares of convertible

^ Fanner Manufacturing Co.

working

•

Thursday, November 15, 1951

...

Inc., Kansas City, Mo.

Hex Foods,

tional share at $1.25 per share—Canadian—at any

page

Chronicle

Aug. 1 (letter of notification) 89 shares of 6% cumula¬
tive preferred stock (par $100) and 424 shares of com¬
mon stock
(no par). Price—For preferred, at par; and
for

common,

at $20 per~share^ Underwriter

Prugh,

—

& Land, Inc., Kansas City, Mo., will act as
Proceeds—For plant improvements and general

Combest

preferred

(par $100). Price—To be supplied by amendment.
Underwriter—Kidder, Peabody & Co., Nft,w York. Pro¬
ceeds—For additions and improvements to plant and

stock

Offering date postponed.

equipment.

Diego, Calif.

California Tuna Packing Corp., San

notification) $300,000 of 6% convertible
sinking fund debentures due Oct. 1, 1966. Underwriter—
Wahler, White & Co., Kansas City, Mo. Proceeds—For
general corporate purposes.
Price—At 100% and ac¬
crued interest. Office—2305 East Belt St., San Diego 2,
Oct. 4 (letter of

Calif.
Carolina

expire

for

three

each

Dec. 12.

Price—At

derwriter ■— None.

Proceeds

share§ held; right to

($100 per share). Un¬
To reduce bank loans.

par
—

Central
Oct.

Illinois

filed

III.

(11/27)
due 1981.
determined by competitive bidding.

Underwriters—To be
Probable bidders:

Co.; Morgan Stanley & Co.; Lehman Brothers; First
Corp.; Equitable Securities Corp.; Merrill Lynch,
Pierce, Fenner & Beane. Proceeds—To repay bank loans
Boston

Bids—Scheduled to be opened

construction.

new

(EST)

a.m.

Central

Maine

Nov. 27.

Power

Co.

(12/5)

Oct. 31 filed $7,000,000 first and general mortgage bonds,
series T, due Nov. 1, 1981.
Underwriter—To be deter¬
mined by competitive bidding. Probable bidders: Hal¬

Stuart &.Co. Inc.; Coffin & Burr, Inc. and The First

sey,

Boston Corp. (jointly); Merrill
Beane and White, Weld & Co.

Lynch, Pierce, Fenner &
(jointly); Salomon Bros.
Hutzler; Blyth & Co., Inc. and Kidder, Peabody & Co.
(jointly); Lee Higginson Corp.; Harriman Ripley & Co.

Inc.

Proceeds—To repay bank loans. Bids—Expected to
Nov. 21 and opened at 11 a.m.
(EST) on

invited

Dec. 5 at 443 Congress

Street, Portland, Me.

4,000 shares of common

(letter of notification)

(par $2.50). Price—$18 per share. Underwriter—
Hornblower & Weeks, New York. Proceeds—To William
stock

shares of 5%

62,041

stockholders

common

record

Nov.

rate

one

preferred share for each twenty common shares held;
with an oversubscription privilege; rights to expire on
23.

Underwriter—Alien &
Proceeds—To retire short-term bank

Price—$50

Co., New
and

per

share.

York.
for general corporate purposes.

Steele, the selling stockholder.

scription at rate of one new share for each 10 shares held

represented by share warrants. Price—To be supplied
by amendment.
Underwriter — None.
Proceeds — For
general funds and working capital.

Steel

Inland

Co.

Aug. 27 filed 250,000 shares of capital
be issuable upon exercise of stock,

stock (no par)
option issuable

Ocala, Fla

(letter of notification)

'jo

26,000 shares of common

★ Florida Telephone Corp.,

mder the company's proposed stock option plan. Price—

be offered inYtiall7To "stockholders
To be 85% of current fair market value
Price—$11.50 per share. Underwriters—
Proceeds—For working capital.
: ;x
Florida Securities Co. and Shaver and Cook, both pf St;^.v ; Iowa Southern Utilities /Co. ; ;
'

"(par $10)"to

about Nov.

15.

Petersburg,

of the stock,

Fla.

•

•>" '/

served

for

conversion

38,239

5V2 %

Proceeds—For expansion program.Oct. 5 filed 76,478 shares of common stock (par $15)

Fosgate Citrus Concentrate Cooperative- (Fla.)

re¬

con¬

stock called for redemption on Nov. 24,
at $30.75 per share (conversion right expires on Nov. 23).
$100); 5,706 shares of 5% class B preferred stock (par
Price—To underwriter at par.
Underwriter—The First
$100), cumulative beginning three years from July- 10, S Boston Corp New York.' Proceeds—To reimburse com1950; 8,000 shares of 4% revolving fund class C stock
pany for money expended for redemption of unconverted
(par $100); 2,000 shares of 4% revolving fund class C
portion of 5M>% preferred stock.v<-' V''','"
stock (par $50); and 4,000 shares of 4% revolving fund,
★ Jacobsen Manufacturing Co. X
class C stock (par $25).
Price—At par. Underwriters
Oct. 25 filed 120,000 shares of common stock (par $1).
—None. Proceeds—To construct and equip frozen con¬
Price—$8.37 V2 per share. Underwriter—A. C.-'Allyn &
centrate plant at Forest City, Fla.
Co., Inc., and Shillinglaw, Bolger & Co., both of Chicago,
111.
Proceeds—For general corporate purposes.
Offer¬
★ General Acceptance Corp?
ing—Now being made; /X X:<XV; yX XX; •'/X-VV. ;vVy VXVX.
Sept. 26 filod $5,000,000 10-year 3V2% sinking fund
debentures due Oct. 1, 1961 (subsequently increased to
★ Johnston Testers, Inc., Houston, Tex. (11/23) :
$7,000,000 principal amount with a *3%% coupon, of , Oct. 29 filed 540,000 shares of common stock (par $1).
which $3,000,000 will be privately placed with two in-;
Price—To be supplied by amendment.
Underwriters—
stitutional investors and $4,000,000 will be offered pub¬
White, Weld & Co., New York; Rotan, Mosle & Morelicly). Price—100% and accrued interest. Underwriters
land, Galveston, Tex.; and Russ &„Co., San Antonio, Tex/
June 29 filed

"I n CZ A»

at 11

■

Co., No. Canton, O.

Hoover

Oct.

v...

★ Imperial Oil Ltd., Toronto, Canada (11/20)
Oct. 31 filed 2,713,384 shares of capital stock (no par)
to be offered to stockholders of record Nov. 20 for sub¬

filed

Halsey, Stuart & Co. Inc.; Kuhn, Loeb

and for

/X'vV

cumulative preferred
stock, series A (par $50—convertible into common stock:
prior to Nov. 1, 1961) being offered for subscription by
Oct.

stock

Light Co., Peoria,

$8,000,000 first mortgage bonds,

;

Ho.

ic Fedders-Quigan Corp., L. I., N. Y.

Oct. 29

Office—Tarboro, N. C.

stockholder.

W. 39th St., Kansas City,
'';
j" " v'
• X,

corporate purposes- Office—412

Cleveland

First

loans

350,000 shares of common
supplied by amendment.
Corp., Cleveland,

rate

one

filed

The

Nov.

dealer.

stock (par $1).
Underwriters—
O., and A. C.
Allyn & Co., Inc., Chicago, 111. Proceeds — To C. G.
Raible, President of the company, who is the selling
Oct.

Price—To

(11/23)
Oct. 30 filed 41,650 shares of common stock to be offered
for subscription by stockholders of record Nov. 23 at
Telephone & Telegraph Co.

(11/19)

r\f\f\

■

453

mIa

shares of class A

A fn

•

-w/A**

**1M

common

>vi

Stock

rt /H"

•

(par

vertible preferred

«■$

I.:

'•

■

★ Central Maine Power Co.
Oct. 31

(12/5)
shares of common stock (par $10)
subscription by holders of 6% preferred

filed 315,146

to be offered for

stock and

stock of record Dec. 5 at rate of five

common

for

common

each

stock held and at rate of

each

shares of

seven

Dec.

waived

17.

The

its

one

seven

share of

new

preferred

common

stock held; rights to expire
England Public Service Co. has

common

New

right

to subscribe for 150,740 of the new
Underwriter—To be determined by competitive

shares.

bidding. Probable bidders: Blyth & Co., Inc. and Kid¬
der, Peabody & Co. (jointly); The First Boston Corp.
Coffin & Burr, Inc.
(jointly); Harrison Ripley &

and

Co.

Inc.

Proceeds—To

bank loans and

repay

for

new

construction.

★ Century Natural Gas & Oil Corp.
Oct. 24 (letter of notification)
23,000 shares of common
stock (par 10 cents). These are
part of 1,175,000 shares
offered in June, 1951. Price—25 cents
per share. Under¬
writer—Greenfield

Co., Inc., New York.

Proceeds—

For

exploration, drilling and development expenses, etc.,
and for working capital.
Office—Waynesburg, Pa.
Columbia Gas System, Inc. (11/26)
Nov. 1 filed 1,501,826 shares of
to be offered to
at rate of

one

common

new

common

stock

(no par),

stockholders of record Nov. 26

share for each

held with

oversubscription privilege; rights to expire about Dec. 12.
Price—To be supplied by amendment. Underwriters—
To be. determined by competitive
bidding. Probable bid¬
ders:

Shields & Co. and R. W. Pressprich & Co.

(jointly);

Morgan Stanley & Co.; Merrill Lynch, Pierce, Fenner &
Beane; Lehman Brothers, Goldman, Sachs & Co. and
Union Securities Corp.
(jointly). Proceeds—To finance
construction program.
Bids—Expected to receive up
to 11:30 a.m. (EST) on Nov. 26.'
Consumers

Public Service Co.,
Brookfield, Mo.
Aug. 22 (letter of notification) 1,500 shares of 5% cumu¬
lative preferred stock.

Price —At par ($50

share).

per

Underwriter—None, but will be sold through WachobBender

Corp., Omaha, Neb. Proceeds—For liquidation of
short-term notes and for further extensions and
better¬
ments of the company's electric
property. Office—201 Vz
No. Main St.,
Brookfieid, Mo.
-

®as Co- Atlantic Highlands, N.

Oct. 23

(letter of notification)

10,399 shares of

common

sroc, ,(no par)

which 1,800 shares are being offered to
I^holders of record Oct. 15 on a 2-for-17 basis; and
8,599 shares

are

offered to the

public; rights expire

No/. 20. Price—To stockholders,
$14.25

per

share.

$13 per share; to public
Underwriter—Woodcock, Hess & Co.,

Inc., Philadelphia, Pa.

Proceeds—For construction

pur¬

poses.

l?e?!t,/?r' 0il CorPv Oklahoma

City, Okla.

Sept. 24 (letter of notification) 175,000 shares of
(par 10 cents). Price—40 cents per share.

stock

Proceeds—For operating

fice—219 Fidelity

common

Under-

filed

cents

three

common

Canadian), of which 3,234,303

offered

record

4,312,404 shares

stockholders

Nov.

stock

25
being

of $1
9.

par value common stock held as of
Subscribers will receive for each three

shares subscribed

for,

a warrant to

purchase

one

addi-

of common

if Granite City Steel Co., Granite City, III. (11/26)
Nov. 5 filed 102,276 shares of cumulative preferred stock
(par $100), convertible through Dec. 31, 1961, to be
offered for subscription by common stockholders of
record Nov.

26 at rate of one

preferred share for each

shares of common stock; Rights to expire about,
Dec. 10.
Price—To be supplied by amendment.
Un- J
12 V2

Corp. and Merrill Lynch,.
Pierce, Fenner & Beane, New York. Proceeds—From'
sale of stock, together with proceeds from proposed sale
of $25,000,000 first mortgage bonds, will be added to
general funds of the company, for use in connection
with its steel production expansion program. MeetingStockholders will vote Nov. 21 on approving authorized
derwriters—The First Boston

issue

preferred stock, issuable in
mortgaging the company's assets.

200,000 shares of

series, and

(letter., of

Exchange Street, Portland 6, Me.:,;

•

Keever Starch Co., Columbus,

Kingsburg, Calif. ;>'/
2,000 shares of capital
share. Underwriter—
Proceeds—To Richard
Fewel, the selling stockholder.
Address—P. O. Box

Kingsburg Cotton Oil Co.,
Oct.

(letter

notification)

(par $1). Price—$4.25 per
Fewel & Co., Los Angeles, Calif.

stock

277, Kingsburg, Calif,
x

Knorr-Maynard, Inc., Detroit, Mich.
(letter of notification) $250,000 of 6% 10-year
due 1961.
Price—At par (in denominations

Oct. 31

debentures

each). Underwriter—Lang-Hennan &
troit, Mich. Proceeds — For working capital.
5743 Woodward Ave., Detroit 2, Mich.
of $1,000

Co., De¬
Office—

Kohn & Co.,

Columbia, S. C.
notification) 925 shares of common
stock, to be offered to present stockholders for subscrip¬
tion and in exchange for outstanding debentures. Price—
At par ($100 per share). Underwriter—None.-- Proceeds
—To retire debt. Office—1526 Main St., Columbia, S. C.'

Oct.

(letter of

if Gulf States Utilities Co. (11/19)
Oct. 18 filed $10,000,000 of first mortgage bonds, due
Nov. 1, 1981.
Richmon^ Va^X^ '
Underwriters—To be determined by-com¬ }'^if: Lawyers iTitte ^nsurince
^Oct. 16 filed 60,000 shares of capital stock (par $5), to
petitive bidding.
Probable bidders: Halsey, Stuart
Co. Inc.; Kuhn, Loeb & Co. and A. C. Allyn & GdVInc.> 'be offered to stockholders at rate of one share for each
(jointly); Stone & Webster Securities; Corp.; Merrill- nine shares held. Price—At par ($5 per share). Under¬
writer—None.'Proceeds—To enlarge capital and for in¬
Lynch, Pierce, Fenner & Beane and White, Weld & Co.
vestment. Statement effective Nov; 6X,
(jointly); Salomon Bros. & Hutzler and Union Securities
Corp. (jointly); Lehman Brothers; Carl M. Loeb, Rhoades
if Lockheed Aircraft Corp.:-?*
X.
X
& Co. and Lee Higginson Corp. (jointly).
Proceeds—To
Oct. 17 filed 27,000 shares of capital stock (par SI), issu¬
pay off short-term loans and to provide the company
able upon exercise of certain options granted to a selected
with funds to carry forward its current construction pro¬
group of officers and employees of company and its sub¬
gram to the Spring of 1952, at which time company ex¬
sidiaries, together with 19,370 shares previously regis¬
pects to undertake additional financing. Bids—To be
tered and issuable upon exercise of options heretofore
received at The Hanover Bank, 70 Broadway, New York
granted td officers and employees, v Price — $19.35 per
15, N, Y., up to noon (EST) on Nov. 19. Statement ef¬
share.
Underwriter—None. • Proceeds—For general cor¬
fective Nov. 7;

Helio Aircraft Corp.,

(letter

cumulative

basis of two shares for each

Ohio-.
? X ■
Vegas, Nev. Office—139 No. Virginia St., Renp,.';N^;XXX
\ug. 1 (letter of notification) -50,400 shares of common
Golconda Mines Ltd., Montreal, Canada/ V'^y vitock. Price — At par ($5 per share); Underwriter—
Mone, Proceeds—To finance inventories and to purchase
April 9 filed 750,000 shares of common stock. Price—;:
At par ($1 per share).
Underwriter—George FvBreen,1 :apital equipment. Office—538 E. Town St., Columbus,
New York.
Proceeds—For drilling expenses, repayment ;
of advances and working capital. Offering—Date not set.
Key Oil & Gas Co., Ltd., Calgary, Canada
X
Oct. 3 filed 500,000 shares of common stock.
Price—At
Grand Union Co., New York
par ($1 per share).
Underwriter—None, but sales will
Aug. 7 filed 64,000 shares of common stock (par $10)
be made by James H. Nelson, promoter and a director of
to be issued pursuant to an "employees' restricted stock
company, of Longview, Wash.
Proceeds—To drill well,
option plan." Price — To be supplied by amendment.
for lease acquisitions and properties held pending devel¬
Underwriter—None.
Proceeds-^-For general corporate
opment work, and for other corporate purposes.
purposes. Office—50 Church St., New York.

July

(par

are

(letter of notification) 200,000 shares

cumulative preferred

Electroiue Jc Television Corp.

General
Oct. 23

notification) 2,186 shares of ;
stock (par $100). Priee—$105 per
share. Underwriter—H; M. Payson & Co.,. Portland Me.
Proceeds—For additions and improvements. ■ Gtfice—95

Oct.

Statement withdrawn Nov. 14.

stock. Price—At par ($1 per share). Underwriter^-None.
Proceeds—To establish and equip stores in Reno ana Las

Of¬

expenses.

Building, Oklahoma City, Okla.
★ Eureka Corp., Ltd., Toronto, Canada
Oct.

working capital.

for

common

Norwood, Mass.
notification) 7,750 shares

non-

shares
stock (par $1) to be offered in units of one
preferred

preferred

stock

and

one

(par

$1)

and

7,750

common

stock.

Price—$25 per unit ($20 for preferred and $5 for com¬
mon). Underwriter—None. Proceeds—For development
promotion expenses.
Office—Boston Metropolitan

and

Airport, Norwood, Mass.

porate purposes.

Statement effective Nov. 6.

;

★ Long Island Lighting Co. (11/27-28)
Oct. 31 filed $25,000,000 of first mortgage bonds, series D,
due 1976. Underwriters—To be determined by competi¬
tive

bidding.

Probable bidders:

Halsey, Stuart & Co.

Blyth & Co., Inc. and The First Boston Corp.
(jointly); Lehman Brothers; Kidder, Peabody & Co.;
Smith, Barney & Co.; W. C. Langley & Co.; Union

Inc.;

Securities Corp.; Equitable Securities Corp.; White, Weld
Co." Proceeds—From sale of bonds, together with

Number 5064

Volume 174

The Commercial and Financial Chronicle

proceeds from sale of 100,000 shares of preferred stock

be used to retire $14,493,400 of bonds
subsidiaries, to repay bank loans and for con¬

if Pacific Telephone & Telegraph Co. (11/20)
Oct. 19 filed $30,000,000 30-year debentures due Nov. 15,
1981.
Underwriters—To be determined by competitive
bidding. 'Probable bidders: Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; Lehman Brothers and Union Se¬
curities Corp. (jointly); White, Weld & Co,
Proceeds—
To repay bank loans and for new construction.
Bids—

(par $100), will

of former

struction
11 a.m.

HEW ISSUE CALENDAR

Bids — Expected to be received at
Nov. 27 or Nov. 28.

program.

(EST)

Chemical

Loven

November 15,

California

(letter of notification)

Lowell

construction

reduce

notes.

Abbott

share for each nine shares

Oct.

privilege;
rights to expire Nov. 21.
Price—$9 per share. Underwriter
None.
Proceeds
To acquire new properties
and for general corporate purposes. Statement effective
on

with

24,

—

* Oct.

oversubscription

17.

Oct

Acceptance Corp. of California
(letter of notification) $100,000 of 10-year 5%

junior subordinated debentures (in various denomina¬
tions) and 306 shares of 5% first preferred stock (par

Of latter, 271 shares will be offered to public and
employees only on an instalment basis. Price
i—At par. Underwriter—Guardian Securities Corp., San
..Francisco, Calif. Proceeds—For general corporate pureposes.
y;
'
1
f
;$20).

35 shares to

Fanner

Oct.

(letter of notification)

$225,000 of

19, 1951
Common

Lehigh & New England RR.
noon
(EST)
Northern Indiana

Bonds

(EST)

noon

(EST)

a.m.

Broadway, New York, N. Y., up to
Statement effective Nov. 7.

Nov. 20.

Oct. 19 filed 633,274 shares of
for

subscription^ by

November
Acushnet Process
Erie RR.

Equip. Trust Ctfs.
Co

Preference

20,

Common

Capital

___.

Paper Co.__

Common

Pacific Telephone &
11:30 a.m. (EST)
Pen

Common

____

Imperial Oil Ltd

Telegraph Co.

bank loans and for

Common

Sylvania Electric Products, Inc

Debentures

-Preferred
Common

Leaseholds, Ltd.___..___

....Common

Par

($1 per share). Underwriter—None. Proceeds—To
purchase machinery and equipment, to construct a mill
Mexico and for general corporate purposes.
State¬
ment fully effective Aug. 29, 1951.
Paramount

Oct. 23
stock

Fire

Insurance

(letter of notification)

N. Y.

Co.,

50,000 shares of common

(par $10) to be offered for subscription by stock¬
of

Oct.

record

two

each

held.

rate

share for

new

one

Corp.

(Transamerica

owns

91,674% out of 100,000 shares outstanding); rights will
expire on Nov. 21. Price—$30 per share. Underwriter—
None. Proceeds—For working capital.
Parker

(EST)_,;._Eq. Tr. Ctfs.

Milling Co., Las Vegas, Nev.
200,000 shares of common stock. Price—At

24 filed

21, 1951

noon

•

Pan American

Jan.

holders

West Coast Telephone Co

New York Central RR.

plant improvements.

Co., Los Angeles, Calif.
Oct. 25 (letter of notification) 9,000 shares of common
stock (par 50 cents). Price — At market (estimated at
$10.75 per share). Underwriter — Shearson, Hammill &
Co., Los Angeles, Calif. Proceeds — To H. A. Bell, the
selling stockholder.

Debentures

Sylvania Electric Products, Inc
Western

stock for each nine

common

and/or preferred stock held as of Nov.

common

27; with rights to expire on Dec. 28. Price—At par ($100
per share).
Underwriter—None.
Proceeds—To reduce

Equip. Trust Ctfs.

Hycon Corp.

Parker

1951

Co., Inc

(EST)

noon

(11/27)

stock to be offered

preferred stockholders

common and

share of

one

common

Packard-Bell

Public Service

November

mort-

second

11:30

shares of

Manufacturing Co.____

Gulf States Utilities Co.

Mineral Products Co., Pittsburg, Kansas

;

Preferred

November

Oxford

V~ Mercantile

To be received at 195

in the ratio of

...

to stockholders at rate of one

held

1951

Laboratories

Exploration Corp.
Sept. 20 filed 49,500 shares of capital stock being offered

16,

Oil

Maracaibo

Bonds

(EST)

if Pacific Telephone & Telegraph Co.

Offering—Expected

Equip. Trust Ctfs.

November

Co., Lowell, Mass.
Oct. 19 filed 30,000 shares of 6% cumulative preferred
stock (which had been offered to holders of the out¬
standing 12,000 shares of preferred stock at rate of 2-%
shares for each share held by them with rights expiring
Oct.' 5, 1951): none subscribed for.
Price—At par ($25
per
share).
Underwriter—Coffin & Burr, Inc., New
York.
Proceeds—To retire outstanding preferred stock
and

(EST)

noon

Western Maryland Ry. 11:30 a.m.

Gas

this month.

1951

Pittsburgh & Lake Erie RR.

200,000 shares of capital
'stock.
Price—At par ($1 per share).
Underwriter—
*None.
Proceeds — For working capital.
Office — 244
"South Pine St., Newhall, Calif.
r
Oct.

(1883)

Oct.

Pen

Co., Janesville, Wis. (11/20)
88,277 shares of class B common

filed

stock

5% bonds to be offered to stockholders in ratio of
as of record

gage

June 30,

1951, with

oversubscription privilege. Price
Underwriter—None. Proceeds—
Office—314 National Bank Bldg., Pittsan

r—At principal amount.
For

equipment.
»burg, Kansas.

November 23,

:Oct.

Laboratories,

stock

Inc., Elkhart,

Johnston

$16.50 per share.
Underwriter—Albert McGann
Co., Inc., South Bend, Ind.
Proceeds—To

mum,

Securities

Estate of Rachel B. Miles.

;

Common

November

•*

Columbia Gas

a.m.

(EST)__Com.

Granite City Steel Co.

Preferred

(EST)

™-^

JEquip, ,TrusI Ctfs.

Mohawk Business Machines Corp.

Nov.

stock

(letter of notification)

80,385 shares of common

(par 10 cents).' Price—$1 per share.

—Tellier

capital..,

&
.

Underwriter
For working

Proceeds

—"

•

Sept. 26
common

November 27,

1951

Inc., Missoula, Mont.
(letter of notifictaion) 2,970 shares of 6%

(EST)

Bonds

Pacific

Montana Hardwood Co.,
V deemable

Central Illinois Light Co. 11 a.m.

Long Island Lighting Co. 11 a.m. (EST)

Co., -New York.

Telephone & Telegraph Co

re-

preferred stock (par $100) and 2,970 shares of
stock (par $1) to be offered in units of one

preferred and one common share.

Price—$101 per unit.
Underwriter—None. Proceeds
To purchase land and
erect plant. Office—123 West Main St., Missoula, Mont.

Common

December 3, 1951
Central Hudson Gas & Electric Corp.-

Consolidated Engineering Corp

-Preferred
Common

—

National Marine

Terminal, Inc., San Diego, Calif.

Oct. 24 (letter of notification) 26,650 shares of 6%

Ferro

Corp.

preferred stock (par $10) and 26,650 shares of
common
stock (par $1) to be offered in units of one
share of each class of stock.

Price—$11

writer—None.

For

purchase

Proceeds

per

unit.

—1592 So. 28th

Under-

Blyth & Co., Inc., Los Angeles, Calif. Proceeds—To Lloyd
'

A. Johnson, President, who is the selling stockholder.

National Plumbing Stores Corp. •
15 (letter of notification) $123,500 of 20-year 3V2%
income notes due Oct.
1, 1971. - Price—100%. Under¬

writers—None.
poses.

Proceeds—For

general

American Bosch Corp...

Preferred

Tennessee Gas Transmission Co,
11

a.m.

(EST)—

...

-Debentures

_ _ _

December 5, 1951

corporate

a.m.

Bonds

(EST)

Central Maine Power Co

-—Common

El Paso Natural Gas Co

-Preferred

December

held, with an oversubscription privilege; rights to expire

share.
Proceeds—For working capital, etc.
change St., Akron 8, Ohio.
on

Nov. 29.

per

accrued./interest.

Underwriter

—

Wachob-Bender

Proceeds—To redeem $27,000 4%%
bonds otustanding, to repay bank loans and for other

corporate purposes.
Nickel

/ Oct. 8 filed 500,000 shares of
be offered for

common

stock (no par) to

subscription by stockholders at rate of

one

share for each five shares held.

Price—$2.25 per share.
(Canadian funds).
Underwriter—None.
Proceeds—To
repay loans from Cliff Petroleum Co., and for expansion
program.
Business — To acquire, explore and develop
mining properties in Canada.
'
Northern

Illinois

Corp., DeKalb, III.
Sept. 13 (letter of notification) 5,138 shares of common
stock (no par). Price—At market (not less than $9 per
share). Underwriter — None. Proceeds
For working
—

•capital.

Offering—Indefinitely
,

,»

Statement effective Nov. 1.

privilege; rights to expire Dec. 5. Price—$2.50 per
Underwriter—Reynolds & Co., New York. Pro¬

share.

ceeds—To pay expenses of

Penn

for

acquisition

of other businesses.

Statement ef¬

Phoenix

Mortgage Co., Inc., Union City, N. J.
of notification) 500 shares of common

(letter

par), 500 shares of $3 preferred stock (no par)
$200,000 of 8% 20-year debenture bonds. Price—
For stock $100 per share and for bonds at par in denomi¬
stock (no

10, 1951

and

———Common

Controls, Inc

existing business, to pay final
shares of Nedick's Inc.,

instalment of purchase price on

.Equip, Trust Ctfs.

each. Underwriter—Irving Blum, Union
Proceeds—For working capital.

nations of $10

December 11,

1951

City, N. J.

Pittsburgh

Bonds

Virginia Electric & Power Co.---

Plate Glass Co.

June 27 filed 450,000 shares of common
to be

Public Service Co.

(11/19)

(letter of notification) 240,000 shares of cumu¬
preference stock (par $25) to be offered to com¬
mon stockholders of record Nov. 9 at rate of one addi¬
tional share for each 12% shares held; rights to expire
about Dec. 3.
Price—To be supplied by amendment.
Underwriters—Central Republic Co., Inc.; Blyth & Co.,
Oct.

lative

become effective on Nov. 19.

ZZ ZZ '•ZZ/Z/:-Z,;\Z

Z * Oxford Paper Co., N. Y.

(11/20)

(par $15).
Price—To be supplied by amendment. Underwriter—The
First Boston Corp., New York. Proceeds—To two selling
Oct.

26 filed

163,676 shares of common stock

stockholders.

Pacific Telecoin Corp.,

/
San Francisco, Calif.

Sept. 14 (letter of notification) 59,000 shares of common
stock (par 10 cents). Price—50 cents per share. Under¬
writer—Gearhart, Kinnard & Otis, Inc., New York. Pro¬
ceeds—For working capital.
Office—1337 Mission St.,
San

Francisco, Calif.

stock (par $10)

offered to certain employees of the company

and

option plan.
Price—At
85% of the market price on the New York Stock Ex¬
change at time options are granted. Underwriter—None.
Proceeds—For working capital.
Its

Indiana

Inc.; and Merril Lynch, Pierce, Fenner & Beane.
Pro¬
ceeds—For construction program. Statement expected to

Offsets, Ltd., Toronto, Canada

Invest¬

if Phoenix Industries Corp., N. Y.
Oct. 12 filed 1,465,167 shares of common stock (par 100)
being offered to holders of outstanding common stock of
National Power & Light Co. at rate of one-half share of
Phoenix Industries Corp. (name to be changed to Na¬
tional Phoenix Industries, Inc.) for each N. P. & L.
common share held as of Nov. 8, with an oversubscrip¬

Oct.

Northern

Corp., Omaha, Neb.

Ry.-

Underwriter—None.
Office—47 West Ex¬

if Nebraska Central Telephone Co., Gibbon, Neb.
Oct. 30 (letter of notification) $55,000 of first mortgage
4y2% bonds, series A, due Nov. 15, 1971.
Price—At 102
and

Price—$11

Proceeds—

Rosalie

fective Nov. 8.

6, 1951

Texas & Pacific

December

Machinery Co., Akron, O.
-Oct. 30 (letter of notification) 22,000 shares of common
stock (par $10) being offered to common stockholders of
seven

and

if Phoenix-Campbell Corp., N. Y.
Sept. 20 filed 203,000 shares of capital stock (par $1)
and
100,000 warrants.
(Oct. 22 filed by amendment
109,650 shares of which 100,000 shares will be offered
to public and 9,650 shares will be reserved for exercise
of warrants bry brokers and dealers).
Priqe—$10 per
Underwriter—Morris Cohon & Co., New York.
share.
Proceeds—To acquire an interest in so-called "special
situations" and for working capital. Offering—Now being

and

pur¬

Rubber

record Nov. 9 at rate of one share for each

Trust

if Penn Controls, Inc., Goshen, Ind. (12/10)
Oct. 25 filed 100,000 shares of common stock (par $2.50).
Price—To be supplied by amendment. Underwriter—F.
S. Moseley & Co., Boston, Mass.
Proceeds—For expan¬
sion program and working capital.

tion

Central Maine Power Co. 11

Office—79 Cliff Street, New York, N. Y.

National

Palmer

ceeds—For construction program.

Oct.

1 >■.
prior preferred
stock (par $25).
Price — To be supplied by amendment
Underwriter—A. C. Allyn & Co., Inc., "Chicago, 111.
Pro¬

made.

December 4, 1951

St., San Diego 13, Calif.

National Motor Bearing Co., Inc.
Sept. 26 (letter of notification) 3,200 shares of common
stock (par $1). Price—$31.25 per share.
Underwriter—

.Common

_________

Pittsburgh Coke & Chemical Co.________ Preferred

working capital and to
additional interest in tuna clippers. Office
—

Co., Inc., Milwaukee, Wis.

ments, Ltd.; the selling stockholder.

cumu¬

lative

William

postponed.

St. Louis-San Francisco Ry.
noon

The

March

Pfd. & Common

System, Inc. 11:30

Peabody Coal Co.
"" 26 filed 160,000 shares of 5%%

26, 1951

American-Marietta Co.

Baird

ert

..Common

Testers, Inc

Ind.

6,000 shares of common
Price—Maximum, $18 per share; mini¬

(par $2).

1951

(letter of notification)

■

writers—A. G. Becker & Co. Inc.,

Carolina Telephone & Telegraph Co

Miles

Price—To be supplied by amendment. Under¬
Chicago, 111.; and Rob¬

(par $2).

$300 of bonds for each share of stock held

subsidiaries under

Pubco

stock

Development, Inc., Albuquerque,

N. M.

filed 605,978 shares of common stock being
offered for subscription by stockholders of Public Serv¬
ice Co. of New Mexico between Jan. 1, 1955 and March

Sept.

31, 1955 at rate of one share of Pubco Development for
each Public Service common share held of record Oct.

1951. Price—At par ($1 per share). Underwriter—
Proceeds—To be used by Public Service in gen¬
Business—To prospect for oil and gas. State¬
ment effective Oct. 11.
1,

None.

eral fund.

if Public Service Electric & Gas Co.
Sept. 26 filed 249,942 shares of 4.70% cumulative
ferred stock (par $100).
Price—$102.17 per shaie

pre¬

Underwriters — Morgan Stanley &
Co., Drexel & Co. and Glore, Forgan & Co.
Proceeds—
For plant additions and improvements and to reimburse
Continued on page 48
accrued

dividends.

The Commercial and Financial Chronicle

(1884)

Continued jrom page

transferable

for retirement of

treasury for expenditures made for such purposes and
long-term debt. Offering—Made pub¬

Oct. 10

licly yesterday.

stock

Puritan

Insurance

Life

Toklan

notification) 2,000 shares of capital stock
Price—$75 per share.
Underwriter—None.
For working capital.
Office —Turks Head

Oct. 9 (letter of

(par $25).
^Proceeds

—

Underwriter—Cohu & Co., New York. Proceeds
building. Office—2 East
St., Frederick, Md.

Oct.

stock
mon

£or

stockholders of record Nov. 13 at rate of
each

four

IPrice—$5
For

being offered for subscription

per

*'-■

;

■

Manufacturers,

U.
Nov.

Underr-

$4,000,000 of debentures due 1971.

Detroit,

Rubber

mann

& Co.,

Mich.r

Nov.

The remainder will go towards

Sept. 1, 1962.

improvements, etc.

property ,
v
*

^ Colorado Fuel & Iron Corp;>
■/—■;!/ v.- Sept. 26, Charles Allen, Jr., Chairman, announced that the
company plans to issue and sell $30,000,000 of 41/4% first
mortgage bonds due 1972 and $10,000,000 of 15-year de¬
bentures, The former issue may: be placed privately and

•

(letter of notification)468,105 shares of common

Probable bidders:

Kuhn, Loeb & Co. and Salomon Bros. & Hutzler
(jointly); Harriman Ripley & Co., Inc.; First Boston
Corp.; Lehman Brothers; Paine, Webber, Jackson &
Curtis; Kidder, Peabody & Co.
Proceeds—To refund
$49,988,000 of 4% non-callable consolidated first mort¬
gage bonds due July 1, 1952, and to redeem $13,747,000'
first and refunding mortgage 4^4% bonds, series D, due

America

Co.;

New York, will act as broker. Proceeds—To

Video Corp. of

p:'*

Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Lee
Higginson Corp.; Harris, Hall & Co. (Inc.); Drexel &

Reclaiming Co., Inc.
4,224 shares of common

selling stockholder.

-4

competitive bidding.

determined by

(letter of notification)

and Carl M. Loeb, Rhoades

(jointly).

approximately $70,000,000 of first mortgage bonds,
1981, of which about $65,000,000 will be sold ini¬
tially. Price—Not less than par. Underwriter—To be

Proceeds—For general cor¬
Corp.,

Co.

due

; stock (par $1). Price—At market, but not less than $5
per share.
Underwriter—None, but Ladenburg, Thal-

Silver Buckie

Mining Co., Wallace, Ida.
Sept. 25 (letter of notification) 290,000 shares of com¬
mon stock
(par 10 cents). Price—32 ^ cents per share.
(Underwriter—Standard Securities Corp., Spokane, Wash.,
and Kellogg, Idaho. Proceeds — To six selling stock¬

•

(letter of notification) 5,085 shares Of preferred
; stock
(par $50). Price—At market (estimated at $44 per
share). Underwriter — None. Proceeds — For working
/capital. Office—300 Buhl Bldg., Detroit 25, Mich.

'■

Radiator

States

United

Office—80 Pliny Street, Hartford,

| j

Chicago & Western Indiana RR.
June 2 it was reported company expects to be in the
market late this year or early in 1952 with a new isSua

Oil Co.

porate purposes.

held;

working capital.

Conn.

by com¬
one

rights to expire Nov. 30.
share; 3 Underwriter—None.
Proceeds—

(

November to

reported company plans in

was

Corp., W. C. Langley & Co.
&

Oct. 22

(letter of notification) 53,750 shares of common

(no par)

Merchants

Underwriter—None.

Plan."

Price—At par

-fa Silex Co., Hartford, Conn. '

Electric Co., Inc.

competitive bidding. Prob¬
bidders: Halsey, Stuart & Co. Inc.; Lee Higginson

able

Inc., N. Y.
Nov. 2 filed 300,000 shares of common stock (par $1) to
be issuable under "The Employees Stock Purchase Plan
and The Executive Employees Restricted Stock Option

Seattle, Wash.

Office—1411 Fourth Ave., Seattle, Wash.

450,000 shares of capital stock of Palmer Stendel
Office—635-644 Kennedy Building, Tulsa, Okla.
United

(letter of notification) 3,000 shares of class B
($100 per share).
Underwriter—
None.
Proceeds — To pay part of purchase price of
Seattle steam heating properties and for working capital.
Oct.

Corp., Tulsa, Okla.

(par 70 cents).
Price—$4.50 per share.
Under-'
writer—None.
Proceeds—To purchase for investment

—To retire debts and purchase

stock.

10 it

Oct.

issue and sell

(letter of notification) 25,000 shares of common

Oct. 11

Finance Corp.

Seattle Steam Corp.,

(approved Sept. 5.) Traditional under¬

Central Louisiana

stock

(letter of notification) $200,0Cf0 of 6% 15-yeai
debentures, dated July I, 1951, to be issued in multiples

Church

3-for-l stock split

writer: Lehman Brothers.

writers—To be determined by

Sept. 18
of $100.

Okla.
10,000 shares of common
Price—At market (estimated at

Royalty Corp., Tulsa,

(letter of notification)

Toklan Royalty

Bldg., Providence 1, R. I.
Ritchie Associates

Aug. 30 it was reported company is contemplating sale
of
additional
common
stock
following approval of

(par 70 cents).
$6.75 per share).
Underwriter—None.
Proceeds—To
Curtis
F.
Bryan,
President, the selling stockholder.
Office—635-644 Kennedy Building, Tulsa, Okla.

R. I.

Co., Providence,

l5, 1&51

Thursday, November

Bing & Bing, Inc.

Price — At par ($5 per share).
Proceeds—For working capital.

warrants.

Underwriter—None.

...

Price—At par (10 cents per share).

Underwriter
For working
: the latter issue offered publicly through Allen & Co.,
capital.
' f..
holders. Address—Box 469, Wallace, Idaho. Offering—
1 New York. The proceeds are to be used to redeem $14,Viking; Plywood & Lumber Corp., Seattle, Wash,
Scheduled for today.
367,500 of outstanding first mortgage 4% bonds and the
remainder used to pay for construction of a new mill at
j Oct. 19 filed 22,500 shares of common stock (no.par) to
Snoose Mining Co., Hailey, Idaho
be offered to employee-stockholders in minimum units
Pueblo, Colo. Stockholders on Nov314: approved the
.July 19 (letter of notification) 1,000,000 shares of comof 125 shares per unit. , Price—$20 per share.
Under¬
financing program.
/
1':
">/
3mon stock.
Price—At par (25 cents per share). UnderProceeds—To purchase 50% of capital
•writer—E. W. McRoberts & Co., Twin Falls, Ida. Proceeds writer—None.
Colorado Interstate Gas.
/stock of Snellstrom Lumber Co.,
v
J
—For development of mine.
Aug. 20 it was reported that the holdings of the Union
Vulcan Iron Works, Wilkes-Barre, Pa.
Securities Corp. group of stock of Colorado Interstate
Skyway Broadcasting Co., Inc., Ashville, N. C.
/ Oct. 17 (letter of notification) not to exceed 17,000 shares
'■> (531,250 shares) will probably be sold publicly in Octo-'
-Sept. 10 (letter of notification) 6,000 shares of common
of common stock (par 50 cents).; Price—At the market
3 ber or November.
istock. Price—$50 per share. Underwriter—None.
/
-v
.*
3
Pro¬
(approximately $2 to $2% per share). Underwriter—
ceeds—For construction and operating capital for a pro:
Consolidated Edison Co. of New York, Inc.
None, but Eaton & Co., New York, will handle sales on
loosed television station.
March 23 company applied to New York P. S. Commli-;
the over-the-counter market.
Proceeds—To John A;
Sonic Research Corp., Boston, Mass.
sion for authority to issue and sell $25,000,000 of first
Roberts, Chairman, who is the selling stockholder.
Oct. 8 (letter of notification) 9,000 shares of common
and refunding mortgage bonds, series H, due May l,
* West Coast Telephone Co. (11/20)
-stock (no par).
Price—$20 per share.
Underwriter—
1981 (in addition to $40,000,000 series G bonds filed with
Nov. 5 filed 40,000 shares of common stock (par $20).
None.
Proceeds—For working capital.
Office—15 Charthe SEC on March 30). Underwriters—To be determined
Price—To be supplied by amendment.
Underwriter— "»
-don St., Boston, Mass.
by competitive bidding. Probable bidders: Halsey, Stu¬
Blyth & Co., Inc. Proceeds—For expansion program and
Southwestern Associated Telephone Co.
art & Co. Inc.; Morgan Stanley & Co.; The First Boston
to reduce bank loans, '
>
;
-*une
15, filed 17,500 shares of $5.50 cumulative pre¬
Corp.; Merrill Lynch, Pierce, Fenner & Beane and White,
;
Western Air Lines, Inc., Los Angeles, Calif.
ferred stock (no par). Price—To be
Weld
&
Co. (jointly).
Proceeds —To redeem a like
supplied by amend¬
Sept. 17 filed 25.000 shares of capital stock (par $1) under
ment. Underwriters—Paine,
amount of Westchester Lighting Co. 3%%. general mort¬
Webber, Jackson & Curtii
option at $9.37^ per share since Dec. 10, 1946 to T. C.
and Stone & Webster Securities
gage bonds due 1967. Offering—Postponed.
Corp.,' both of New
Drinkwater, President. Agreement - provides that, upon
Siork, and Rauscher, Pierce & Co., Inc., Dallas, Texas.
if Consolidated Grocers Corp.
>
>
request of Mr. Drinkwater, the company agrees to regis¬
^Proceeds—To retire $1,500,000 of bank loans and the
Oct. 8 it was stated company plans issuance and sale of
ter the optioned shares to the end that he may be in
balance added to general corporate funds. Offering —
$10,000,000 of preferred stock (par $50). Underwriter—A.
a position promptly to exercise his. rights under the op¬
Postponed.
C. Allyn & Co., Inc., New York.
Proceeds—To retire
tion and to transfer and dispose of any of the shares ac¬
present Outstanding 5 % preferred stock and to expand
Specialized Products Corp., Birmingham, Ala.
quired thereunder which he may wish to dispose of. (The
.Sept. 26 (letter of notification) 50,000 shares of common
output of company's eight divisions.
\
,
stock sold at $14.50 per share on Sept. 17 on the New
^tock
Price—$1 per share. Underwriter—Carlson & Co.,
Cott Beverage Corp./ New Haven, Conn.
York Stock Exchange.) Underwriter—None. Proceeds—
.Birmingham, Ala. Proceeds—For operating capital and
For working capital
Aug. 22 it was stated that the company plans issuance
($9.37lk per share). Statement
-advertising costs. Office—2807 Central Ave., Birming¬
and sale of 30,000 shares of preferred stock (par $10),
effective Oct. 24.
ham 9, Ala.
<
6
each share to carry a bonus of common stock.
Under¬
if Western Leaseholds, Ltd., Canada (11/20)
;
writer—Ira Haupt & Co., New York. Proceeds—For ex¬
& Standard Oil Co. (Ohio)
Oct. 30 filed 1,250,000 shares of common stock (no par).
Oct. 18 filed 364,536 shares of common stock
pansion program.
;,
- .
"
,k
:
(par $10)
Price—To be supplied by amendment.
Underwriters—
being offered for subscription by common stockholders
Diamond Alkali Co.
,
Morgan Stanley & Co. and Carl M. Loeb, Rhoades & Co.
of record Nov. 7 at rate of one share for each 10 shares
Oct. 29, Raymond F. Evans, President, announced that
in the United States (for 625,000 shares) and A. E. Ames
held; rights to expire Nov. 21. Price—$38.50 per share.
stockholders will vote Nov. 15 on authorizing the creation
& Co., Ltd., and Mills, Spence & Co., Ltd., in Canada (for
Underwriter—F. S. Moseley & Co., Boston, Mass. Pro¬
of an issue of $25,000,000 preferred stock (par $100), of
625,000 shares). Proceeds—To 39 selling stockholders.
which it is planned to sell publicly not more than 120,000
ceeds — For capital expenditures and working capital,
Western Reserve Life Insurance Co.
statement effective Nov.. 7.
shares (to be convertible into common stock)
late in
June 12 (letter of notification) 10,000 shares of common
/ Sterling, Inc., New York
1951 or early in 1952. Underwriter—Probably The First
stock (par $10) to be offered for subscription by present
Oct. 22 (letter of
Boston Corp., New York. Proceeds—To finance expan¬
notification) 10,000 shares of common
/stock.

:?—

Tellier & Co., New York.

Proceeds

—

Stock

(par $1). Price—At market (approximately $4.50
share). Underwriter—Merrill Lynch, Pierce, Fenner
Ac Beane, Chicago, 111.
Proceeds—To David S. Berry,

H stockholders at rate of one share for each two shares held.

per

Vice-President, who is the selling stockholder.
Sylvania Electric Products, Inc. (11/20)
1
£971.

fdpd $25,000,000 of sinking fund
Price—To

supplied

debentures due

amendment.

wTiters—Pame, Webber, Jackson & Curtis
Stuart

Co.

Inc.,

New

$17,200,000 of 3Vi%

York.

Under-

and

Halsey,

Proceeds—To

retire

debentures, to finance expansion >

program and for

working capital. Meeting—Stockholders
•will vote Nov. 19 on
approving financing program (See
Mso registration of 200,000 shares of
preferred stock.)

Sylvania Electric Products, Inc. (11/20)
Nov. 1 filed 200,000 shares of $4.25 cumulative convert¬
,

ible preferred stock

amendment

for

working

vote Nov. 19

Wilcox-Gay Corp., Charlotte, Mich.
Sept. 13 (letter of notification) 165,250 shares of common
stock (of which 82,625 shares represent stock to be issued
on exercise
of stock purchase warrants issued in con¬
nection with sale of 110,000 shares on or about Oct. 24).
Price—At par ($1 per share). Underwriter—None. Proceeds—For working capital.

Webber,

Jackson

Meeting—Stockholders

approving financing

program.

A-Tennessee Gas Transmission

Co.

(12/4)

bidding. -Probable

bidders:

Halsey,
^
*nc,» Stone. & Webster Securities Corp. and
White, Weld & Co. (jointly). Proceeds—To repay shortterra notes and for expansion program.
Bids—Expected
tope received on or about 11 a.m. (EST) Dec. 4.
■

i?out?eas*®rn Gas Co., Bellville, Tex.

May 16 (letter of notification) 19,434 shares of
fttock to be offered to common stockholders

used

proceeds

Halsey, Stuart
Inc.; Morgan Stanley & Co.; Kuhri, Ldeb & Co.;
The First Boston Corp. Offering expected some time in

stock.

through

York.

;

reported that certain

(12/5)
early

;

registration

is ex-

ture in 20
ders:

the company up to noon (EST)
from it of $5,400,000 equip¬

equal semi-annual instalments.

Halsey, Stuart & Co. Inc.; Salomon

ler; Harris, Hall &
»

certificates, equipment trust of 1952, to ma¬

: Oct.

25 it

Probable bid¬
Bros. & Hutz¬

Co. (JneJ^

t /
offen addinext'year. 'Probable under-,
Allyn & Co., Inc.. Chicago, ;I1L. / ,
,

Foote Bros. Gear &
was.

Machine Corp;.

reported ?th:at /.company;may,

tional common stock early

writer—A. C.

stockholders of the

may sell about, 20% of presently outstanding
Underwriter—Probably Lehman Brothers, New
Offering—Expected about middle of next month.

company

common

Laboratories, Inc.
was

Traditional under¬
York.
' f ;

Nov. 20 for the purchase

Nov.

expansion.

(11/20)

Bids will be received by
ment trust

Co.

/■/;'

for

about

if Erie RR.

bonds due July 1, 1952. Probable bidders:

Baxter

100,000 shares of sinking fund first
preferred stock (par $100) is expected.^ UnderwriterWhite, Weld & Co., New York, Proceeds—For expansion
pected

Sept. 14 it was stated that the company may refund its
outstanding $22,388,000 first consolidated mortgage 4%

•

stock

^ El Paso Natural Gas Co.
Nov. 7 it was reported that

Prospective Offerings

November.

program.

3
proposal increasing
750,000 shares from

writer; J. Arthur Warner & Co. Inc., New

Atlantic Coast Line RR.

Nov. 1 filed $25,000,000 of 20-year
sinking fund deben¬
tures due Nov.
1, 1971. Underwriter—To be determined

competitive

the

(See also

Corp.

500,000 shares, of which 420,000 shares are outstanding.
Additional shares may be issued to stockholders, and

—

will

capital

authorized

the

Boats, Inc., Costa Mesa, Calif.
Oct. 10 (letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Underwriter—None.
Proceeds
For purchase of building and property and
for working capital.

registration of $25,000,000 of debentures.)

:l '.

Stainless Steel

Eastern

Oct. 25 the stockholders approved a

Wizard

Proceeds—To increase plant capacity

capital.

Financing—Company also plans to

Price—To be supplied by

Underwriter—Paine,

Curtis, New York.
-.and

(no par).

Registration—Expected this week. Private
borrow before Dec.
31, 1951, the remaining $4,000,000 under its loan agree¬
ment with Metropolitan Life Insurance Co.
^

sion program.

Price—$20 per share.
Underwriter—None.
Proceeds—
For financing expansion program.
Office—1108 Lavaca
Street, Austin, Tex. ,'/•
3

Des Moines & Southern Ry.Nov. 1 company applied to ICG for authority to issue
and sell $750,000 first mortgage bonds. /Proceeds will
be used to build additional power plant facilities.
Fort Dodge,

Volume 174

Number 5064

The Commercial and Financial Chronicle

(1885)
Hahn Aviation
Products, Inc.
Aug. 24 it was announced company proposes to offer
12,500 additional common stock (par $1), in addition to
17,500 shares recently offered. Underwriter
None.

* New York Central RR.

—

Proceeds

For

—

engineering, acquisition of machinery

and other corporate
purposes. Office—2636 No. Hutchin¬
son
1

Oct. 30 it
sell

due $540,000 each Dec.
sive.
Probable bidders:

reported company

soon plans to issue and
shares, of common stock (par $5.).
Allyn & Co., Inc., Chicago, 111.;
Co., Milwaukee, Wis.
Proceeds—For working

'Loewi &

★ Hycon Corp.

writers—To

(11/20)

company

Telephone

Proceeds—For

has

temporarily postponed.
writer—White, Weld & Co., New York.
Iowa-Illinois

}Oct. 8 it

Gas &

Electric

and

sale

over

the

three

years

;

about

60,000 shares of preferred stock (par $100) or $6,000,000
in debentures; also an issue of about
$12,000,000 in first
mortgage bonds.- Underwriters—For bonds, to be deter¬
mined by competitive
bidding. Probable bidders:

tion

Co. Inc.;

those

mentioned

probable

bidders

for

Lehigh & New England RR. (11/19)will be received by the company at Room 2001,
123 So. Broad Street, Philadelphia 9, Pa., up to noon
<EST) on Nov. 19 for the purchase from it of $1,875,000
equipment trust certificates, series M, to mature in 15
equal annual instalments. Probable bidders: Halsey,
Stuart & Co. Inc., Salomon Bros. & Hutzler.

construction

program for 1951 and 1952
next year of common stock, and senior

Barney & Co.; The First Boston Corp.; Glore, Forgan
& Co.; Lehman Brothers and Riter & Co.
(jointly);
Equitable Securities Corp.; Union Securities
Corp.; Mer¬
rill Lynch,
Pierce, Fenner & Beane;-Kidder, Peabody
& Co. and White, Weld & Co. (jointly). Probable bidder
on bonds
only: Halsey, Stuart & Co. Inc.

Philadelphia Electric Co. \
Sept. 30 company announced that about $200,000,000 will
have to be raised through the sale of additional secur¬
ities, spaced at intervals, and in amounts which will
permit ready absorption by the investment market. The
overall construction program has
already cost $217,000,000, and will require expenditures of about $365,000,000
in the years

Pioneer
Oct.

tional

Air

was

1951 to

Lines,

1956.

Inc.,

Tex.

Dallas,

reported that company may issue addi¬

securities

sufficient

raise

about

Bids

Lehmann

(J. M.)

Co.

(N. J.)

Mathieson Chemical
Oct. 25 it
with

and

was

into this

Chemical
sell

company

merger

of Mathieson Hydrocarbon

will

terms to be set at

later date.

McKesson

working

capital

and

Robbins,

used

for

Inc.

stockholders

Mengel Co.
Aug. 10, Alvan A. Voit, President, stated that the com¬
pany plans to spend from $15,000,000 to $20,000,000 for
expansion, but that plans for financing have not yet
been completed. Traditional underwriter—F. S. Moseley
-

& Co.
°

Merritt-Chapman & Scott Corp.
Oct. 23 it

was

announced stockholders will vote Jan. 15,

approving the creation of an authorized issue of
100,000 shares of convertible preferred stock (par $50).
Underwriter—Carl M. Loeb, Rhoades & Co. Proceeds—
For expansion program.
on

★ Metals & Chemicals Corp., Dallas, Tex.
Oct. 3 it was stated company plans issue and sale of 100,000 shares of common stock. Price—$3 per share. Under¬
writers—Beer & Co. and Binford, Dunlap & Reed, both
of Dallas, Texas, and Stuart M. Wyeth Co. of Phila¬
delphia, Pa. Proceeds—For working capital, etc. Offer¬
ing—Expected today.

England Power Co.
Sept. 6 it was reported that company plans to sell about
50,000 shares of preferred stock this Fall. Underwriters—
To be determined by competitive bidding. Probable bid¬
ders: Lehman Brothers; Equitable Securities Corp. and
Carl M.

Loeb, Rhoades & Co. (jointly); The First Boston
Corp.; Merill Lynch, Pierce, Fenner & Beane; Kidder,
Peabody & Co.; The First Boston Corp.; W. C. Langley
& Co.; Harriman Ripley & Co., Inc. Proceeds—To repay
loans and for construction program.

Probable bid¬

Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

Oct.

was

announced stockholders will vote Dec. 5

increasing authorized 5^% prior preferred stock,
first series, from 225,927 to 400,000 shares and the.
authorized
shares.

stock from
1,500,000 to 2,500,000
Underwriters—Kuhn, Loeb & Co.

common

Traditional

Public Service Co. of North

Carolina, Inc.
announced company plans to issue and

July 12 it
sell

was
several million

Fall.

dollars of first mortgage bonds in
July last year, $1,200,000 of bonds were
placed. privately with two institutional investors.
Purex

Oct.

Corp., Ltd.
stockholders

stock

voted

increase

the

authorized

1,000,000 shares from 500,000 shares.
Traditional underwriters': Blyth & Co., Inc., New York;
William R. Staats & Co., Inc., Los Angeles, Calif.
common

Rochester Gas & Electric Corp.
Aug; 1 it was announced that company expects to issue$5,000,000 additional first mortgage bonds and additional
debt securities or preferred or common stocks, bank
borrowings, or some combination thereof, in connection
with its construction program. The method of obtaining
such additional cash requirement has not been deter¬
mined. Previous bond financing was done privately.
July 18, it was reported that the company expects to

raise

through the sale of some preferred stock
later this year. Underwriter—Probably The First Boston
Corp., New York. Proceeds—To finance, in part, a $10,000,000 construction program the company has budgeted
money

for the next two years.

Royal Typewriter Co.,
Oct. 19 it
on

was

increasing

announced stockholders will vote Nov.

authorized

planned.

stock to 2,000,000
No immediate financing is

common

Ryan Aeronautical Co., San Diego, Calif.
Aug. 4 it was announced company plans to increase
its

authorized

capital stock (par $1) from 500,000 to
1,000,000 shares in order to place it in a position to
do appropriate financing of sqme form of its own securi¬
ties if and when advantageous to the company. The new
financing may take the form of a general offering for
sale to the public or granting of rights to
stockholders;
or

the reservation for conversion
.(!

subsidiary.

Ryan School of Aeronautics.
•

St. Louis-San Francisco
Ry. (11/26)
Bids will be received by the
company at 120 Broadway,
New York 5, N.
Y., up to noon (EST) on Nov. 26 for thepurchase from it of $4,725,000
equipment trust certifi¬
cates, series J, to mature in 15 equal annual
instalments.
Probable bidders:
Halsey, Stuart & Co. Inc.; Salomon
Bros. & Hutzler.

Sobering Corp.
Oct 3 it

tire

was

common

reported that the sale of the
company's en¬
stock issue
(440,000

shares)

was

not

of long-term

indebt-

ex¬

pected for at least two months. The sale
will be made
the highest bidder
by the Office of Alien

Property.

Probable bidders: A. G. Becker &
Co. (Inc.), Union Se¬
curities Corp. and
Ladenburg, Thalmann & Co. (jointly);
Merrill Lynch, Pierce, Fenner &

Beane; Kidder, Peabody

Co.; F. Eberstadt & Co.; Allen & Co.; new
company
formed by United States & International
Securities Corp.,

Dillon, Read & Co.; F. S. Moseley & Co.; Riter & Co.
Seaboard &

Oct.

was

Western

reported

Airlines, Inc.

that

company

totaling $6,500,000 to $7,000,000 for
equipment. May be placed privately.
South

April
plans
this

Jersey Gas Co.
Smith, President,

Earl

bond

issue

purchase

announced

than

plans financing
of

new

company

$8,000,000 by fall of

year.

Underwriters—May be determined by com¬
petitive bidding.
Probable bidders:
Halsey, Stuart &
Co. Inc.; Lehman Brothers; Blyth &
Co., Inc. Proceeds—
To refund the
presently outstanding $4,000,000 of 4%%
first mortgage bonds and
repay outstanding short-term
bank notes which are due before the end of
the
year.

Southern California Edison Co.
!
+
Aug. 29 it was announced company may have to raise

approximately $49,900,000
nancing to take

care

through

of its

1951-1952

additional fi¬

construction

pro¬

Probable bidders for bonds:

gram.

Halsey, Stuart & Co.
Inc.; Kuhn, Loeb & Co.; Blyth & Co.,
Inc.; The First
Boston Corp. and
Harris, Hall & Co., Inc. (jointly). These
bankers bid for the
$30,000,000 issue of 3y8% first and
refunding mortgage bonds which were sold last week.
The nature, amounts and
timing of t%e new financing
cannot now be
determined, and will depend in part on
market conditions
existing from time to time and may
include temporary bank loans.
•
"
1
.

Southern California Gas Co.
April 4, the company indicated it would this
year be in
the market with
$18,000,000 of senior securities. Prob¬
able bidders:
Halsey, Stuart & Co. Inc.; Blyth &
Co.,,
Inc.; White, Weld & Co.; Lehman",
Brothers;

Merrill,
Lynch, Pierce, Fenner & Beane and Harris, Hall & Co.
(Inc.) (jointly).
Offering—Expected in the Fall.
- 3
Southern Natural

July 31 it

Gas Co.

announced company

was

has filed an applica¬
permission to construct additional
estimated $13,641,000, of which ap¬
proximately $9,187,000 is expected to be spent in 1951.
tion

with

FPC

for

facilities to cost

•
Spear & Co.
?/
V
Nov. 5 announced that the
management, headed by A. "ML
Kahn, President, which now owns 100% of the 18,750
shares of no par second preferred stock
(dividend rateto be changed from $5.50 to
$5 per annum), will offer

this

stock

rate of

one

common

stockholders for

subscription

preferred share for each 12

common shares
held. Price—$105 per share.
Meeting—Stockholders will
vote on Dec. 5, among other
things, to make the second
preferred stock convertible into common stock

(initial

conversion rate to be 12 shares of common for each
share

preferred).

Texas-Ohio Gas Co., Houston, Tex.
Oct. 17 company applied to FPC for
authority to con¬
struct a 1,350-mile natural gas transmission line
extend¬
ing from Texas into West Virginia. The project is esti¬
>

mated to cost $184,989,683.

• Texas & Pacific Ry. (12/6)
Nov. 13, W. G. Vollmer,
President, announced that
will invite bids

f
com¬

Nov. 20, returnable Dec.
6, for a
$2,900,000 issue of equipment trust certificates, series N.
Probable bidders:
Halsey, Stuart & Co.
pany

Inc.;

Bros. & Hutzler.

Salomon

;

•

Texas Utilities Co.

Sept. 24 it
around

was

reported company may issue

400,000 additional shares of

1952. Probable

Blyth

Lehman

Co.,

bidders:

Inc.

Brothers

and

sell

stock early

The First

(jointly);
and

common

Boston Corp. and
Union Securities Corp.;
Stearns & Co. (jointly);

Bear,
Goldman, Sachs & Co. and Harriman Ripley & Co. Inc.
(jointly); Kidder, Peabody & Co. and Merrill Lynch,
Pierce, Fenner & Beane (jointly).

.1,,^

Tide Water Power Co.

Inc.

shares from 1,078,816 shares.

New

bank

l-to-15 years.

Pittsburgh Steel Co.

the

added

approved a proposal to increase
authorized common stock by 500,000 shares to 2,500,000
shares.
No immediate financing contemplated.
; Prob¬
able underwriter: Goldman, Sachs & Co., New York.

1952

ders:

The pro¬

research and product development.

Oct.

(11/15)
Bids will be received by the company at 466
Lexington
Avenue, New York, N. Y., until noon (EST) on Nov. 15
for the purchase from it $6,435,000 equipment, trust

Corp., it is the intention of the company to
portion of 250,000 shares of new pre¬
on

Pittsburgh & Lake Erie RR.

substantial

ferred stock
ceeds

Corp.
/
following proposed

announced that

$700,000

$800,000. Underwriters: Probably Schneider, Bernet &
Hickman and First Southwest Co., both of
Dallas, Tex.;
and Chas. B. White & Co. of
Houston, Tex.

certificates to mature in

Sept. 1 it was reported that the Office of Alien Property
expects to call for bids in October on all of the out¬
standing stock of this corporation.

could be issued with provision
for con¬
common stock.
The company
presently
has outstanding 439,193 shares of
capital stock, of which
45,350 shares are held by the wholly owned

Smith,

„

ap¬

required

presently out¬
standing 197,600 shares of $1 par value. Probable Under¬
writer—H. M. Byllesby & Co., Chicago, 111. Proceeds—
For working capital.
v

Proceeds from the sale of the preferred stock or deben¬
tures (probably late this year) will be used to retire a

★ Kellogg Co., Battle Creek, Mich.
Oct. 30 it was reported Kellogg Foundation (said to be
the owner of about 50% of the outstanding $1 par stock)
■may dispose of some - of its holdings.
Underwriter—
Probably Morgan Stanley & Co., Clark, Dodge & Co.
and Glore, Forgan & Co., New York.
/

money will be

new

This may involve the issuance of
24,700 additional
shares on a one-for-eight basis. There are

the

com¬

its

ers.

bonds, with the exception of Halsey, Stuart & Co. Inc.

$6,000,000 bank loan used to finance, in part, the
pany's construction program.
;

finance

(Minn.)
estimates that

company

Parkersburg Rig & Reel Co.
Aug. 1 A. Sidney Knowles, Chairman and President, an¬
nounced that the directors have
approved in principle a
plan to offer a modest amount (not exceeding $300,000)
of common stock for
subscription by common stockhold¬

Halsey,
Harriman Ripley & Co., Inc., Union
Securities Corp. and White, Weld & Co. (jointly); Equit¬
able Securities Corp.; Glore, Forgan &
Co.; Harris, Hall
& Co. (Inc.); Lehman
Brothers; Blyth & Co.; The First
.Boston Corp.; Smith, Barney & Co. The following may
;bid for preferred stock: Blyth & Co., Inc.; Merrill Lynch,
Pierce. Fenner & Beane; Kidder, Peabody &
Co., in addi¬
Stuart

same

Olsen, Inc., Elyria, O.
Oct. 19 it was reported
early registration is planned of
about 225,000 shares of common stock.
Underwriter—
McDonald & Co., .Cleveland, O.
Proceeds—To certain
selling stockholders.Business—Manufactures hot air
furnaces.
Offering—Expected in November.

Co.

announced

was

securities., Probable bidders for stock and bonds:

Under¬

that the company contemplates

was announced

issuance

through the sale

Co.

been

proximately $32,500,000 of

reported that the sale of 38,433 shares of

was

stock

(1,000,000 shares) if

Northern States Power Co.
Oct.

that thii

announced

(approximately 99.31% owned by American
& Telegraph Co.) plans issuance and sale,

Interstate Petroleum

stock

common

to be issued.

before the end of the year, of
682,454 addi¬
tional shares of capital stock to its stockholders. ..Under¬
writer—None. Proceeds—To repay short-term loans and
for new construction.

Sept. 11 it

bidders:

which

vertibility into

determined

Probable

bid for

may

sometime

class

by competitive bidding, if
Halsey, Stuart & Co.7 Inc.;
Morgan Stanley & Co.; Kuhn, Loeb & Co.; The First
Boston Corp.
Merrill Lynch, Pierce, Fenner & Beane
bonds.

Business—Electronics.

Illinois Bell Telephone Co.
"
June 27 W. V. Kahler, President,

anticipates that
early in 1952

order to repay $35,000,000 bank loans.
No definite
plans for such financing have been formulated.
Under¬

plans to issue and sell
.290,000 shares of common stock.
Price—$1 per share.
Underwriters—Gearhart, Kinnard & Otis, Inc., New
working capital.

company

be undertaken

company

York, and White & Co., St. Louis, Mo.

announced that

was

permanent financing will

(Calif.)

reported

was

Oct. 26 it

capital.
Nov. :1 it

★ Niagara Mohawk Power Corp.

200,000

/Underwriters—A.

Bros. & Hutzler.

mon

Manufacturing Co.

was

about

ednCss

of'1951, dated Dec. 1, 1951,
1, from 1952 to 1966, inclu¬
Halsey, Stuart & Co. Inc.; Salo¬

and

St., Philadelphia 33, Pa.

Hamilton

(11/21)

Bids will be received
by the company until noon (EST)
Nov. 21 at its office at 466
Lexington Ave., New York,
N. Y., for the purchase from it of
$8,100,000 equipment
trust certificates, second issue
on

Sept.

North

was

Carolina

reported
Utilities

has applied to the
for permission to

company

Commission

borrow $1,500,000 on 3% notes. These notes would be
refunded through the sale of common or preferred stock.
Traditional underwriters: Union Securities Corp. and
W. C.

Langley & Co., New York. Proceeds from notes to

be used to pay for construction costs.
Transcon
Oct.

Lines, Los Angeles, Calif.

was

reported company

may

considering /

issuance and sale of 30,000 shares of common stock
(bar

$10).
Los

Underwriter—Probably Floyd A. Allen & Co., Inc.,

Angeles, Calif.

Continued

k.;

page 50

i,
it.

The Commercial and Financial Chronicle

Thursday, November 15, 1951

...

(1886)

Continued

from

United Gas

announced that "it
$50,000,000
the total financing, and it is presently antici¬
will be done by the sale of first mortgage and

Aug. 1, N. C. MeGowan, President,

for an additional

will be necessary to arrange

—For

authorizing the sale of 481,307 additional shares of
common
stock to present stockholders at rate of one
share for each two shares held. Price—At par ($6.50 per
on

None.

sell

public $2,500,000 of 20-year convertible deben¬
between 3!/4% and 4y4%

tures to bear interest at a rate

Stockholders will vote Nov. 15 on increas¬

per annum.

announced

was

Nov.

You

cease.

these

democracy

Lies in Strong^
Economy and Alert Citizenship
employed in

private industry at that time, and

:viA

letter

This

most

the

cases

amount

is pitifully small. Even lion
minority of workers million cast votes. The difference
have other so-called fringe bene¬ of 39 million represents part-time
Again in 1950, out of
fits.
Fringe
benefits
are
well citizens.
named—only

fringe of industry nearly 97 million potential voters,
only 42 million, less than half,
voted.
Mayor O'Dwyer not long

has them.

device

latest

The

economic system more

the

make

democratic

options to

of stock

grant

our

employees. While in 1950 the Con¬
gress
provided the means, this

said to me, "You and thou¬
of other businessmen like

ago

sands

responsible for making an
You won't

you are

like me Mayor.

ex-cop

take

the time to do your duty as

plan has misfired. Instead of the citizens." That was before Senator
workers becoming partners in the
Kefauver helped us and him out.
enterprise, in the overwhelming
In the home, our young people
majority of cases only top man¬ desperately
need fathers
and
agement has

been granted these mothers

who are full-time citi¬
options. Most or all of the pie has zens. My generation had a taste
gone to a privileged few.
of what was to come for succeed¬
.

Here

tremendous

oppor¬
ing generations.
Since 1917, we
tunity for full-time citizens in in¬ have lived from one emergency to
dustry to strengthen these areas another. The youngsters of today
of our economic system.
face an even
grimmer prospect.

business

The

professional

leads two lives. I don't

man

infer

that

leads

mean

double

life. When he goes home at
he

another

enters

His

world.

terests shift to community
and his
In

few

affairs

heard

you

citizens.

will
How

that

activities—activities

that are ,es¬
sential if American democracy is
to function effectively? The par¬

ticipation of the average citizen
is

limited

usually
that

small

cash

con¬

spite of their security being
continuously threatened and their
futures clouded, there never was
a
finer generation of Americans
than our young people of today.
Among them you will find may
I'd like to read
from

from

tenant

Sam

will

the

have

few excerpts

letter received a few days

one

Americans

—

now

of these young
22-year-old Lieu¬

stationed at Fort Ben-

ning. I quoce, "You have probably
in the newsreels or read in

seen

the

how some 300
officers have been

newspapers
Korean

South

study
Well,
150 of these Koreans have come to

sent to the-United States to

warfare.

methods

our

(although nowadays it's
check to make certain

Uncle

Fort Benning.

officers

these

"Most

come

privilege of sharing in the cost of
the contribution).

from the finest families in Korea.

Jean Rousseau in 1762 summed

They received their education in
the
Korean
Military
Academy,

the dangers of part-time citi¬

zenship
soon

public

the

and

well.

very

said,

service

chief business

"As
to

ceases

citizens

they would rather serve with
than with their persons,

money

the state is not far from its fall."
Politics the Citizen's Business

Politics also
citizens.

are

Now

Does

his

and

citizen
not

actions

through

intention¬

ally or unconsciously affect the
thinking and votes of other citi¬
zens?

This is

which

democracy at work.

modeled

Point.

They

the

letter

courses
cers was
no

time

portant

Facing Full-Time

would

make

where

counts

wishes
the

most

known
—

his

town

fathers, his State Repre¬
sentatives and his Congressmen.
If, for example, he realizes infla¬

own

noticed

of
the

subjects—an

ex¬

fault.

the

in¬

contacting

After

officers—that

sounds

obtain clear¬
ance for my plans, I was able to
set up a voluntary program of in¬
Army—to

struction for those interested.
"The

tion threatens his way of life, or
believes racketeers operate

Korean

openly in defiance of the law, if

the

he feels that the

have 102 of these student officers

ardized

will

quality of edu¬
is jeop¬
by underpaid teachers, he

for

make

his

have the
ent

tion

though

system

our

means

to halt the pres¬

will be
with¬

its worth

aggressor,

may

strong

is an empty

economy

It may

be that we

profits most who serves best." In
this life
and
death struggle in
is engaged,

which the free world
these challenges
The

will increase.
our
defenses

building

fade away. We may fade
into
the darkness of
a

decadent
then

enter

world

The

state.

may

dark that
following
the collapse of the Roman Empire
an

age

dark ages

will shine

brightly in comparison.
not improbable that the

ages

preceding

were

dark

the

Renaissance

the

wise

because the

fled

time

may

be only the forerunner of a

because

still

greater

challenge. From my
limited knowledge of history

men

hills

the

own

certainly don't claim to be

—and I

I know of no case
where two hostile nations, armed
to the teeth, ever backed away
from war and liquidated their in¬
ventories of manpower and war
expert

—

materials.
the

time

this

exception, it will take

high

them.

They

did

Continued

from

page

children

known his convictions

to every office-holder who repre¬

tendance

officers.

enthusiam

South

these

continued

increased.

now

learning about the American way
of life. These young men
sume

the

will

as¬

great leadership positions in

government

Korea

when

prizefight, who brings along
radio set so that the

portable

she

slip

away

trustees

who

the American

are

eyes

and her ears are one and the same.
And

often

the

is with

mor¬

ning-after description of the day's
stock market action.

During the past month of mar¬
reaction, I have culled the
following captions applying even
ket

declines:

1-2%

mere

—

"Market

responsibility of being full-

time citizens.

Reel

"Stocks

Own
New

Blows."

"Savage Selling."

Dramatization and

•

glamorization

have extremely serious

import in-

princi¬
of market
movements; in over-emphasizing
the importance
of liquidity; in
adding to the mistaking of price
changes for value changes; and
undermining

investment

ples; in making

a game

the

accentuating

concentrate

The Investor and the News

from

From

Falls

Weight."

the

do not accept the primary
responsibility of that trusteeship

Routed"

"Stocks

democ¬

racy

—the

witnessing

scarcely believe that the

can

may

she

proceedings before both her

civilization

world's

what

tion

remain to
that faced
being full-

not

stopped

free

the

You

sweetheart grudgingly- attend*

ing

time citizens. It is not improbable

that

movements.

probably have heard of the wife

work out the problems

they

over-glamorization "5 of

market

will relieve her boredom. At first

the so-called

just

and

stock

nation shall
shall

as a

individual who coined the Rotary

slogan hit upon a basic truth, "He

The

broadcaster's picturesque descrip¬

away

are

Inc.;

thing.

stirring. If
they are met, they will make life
richer and more satisfying. The
life,

military

tendency

the forecasting of

quotation-changes of "the chips,"
in
lieu
of
appraising the real
of the businesses in which

worth

IIow Not to Read
We must avoid
the
they represent shares—all under¬
continuing manifestations of
(1) Avoid rumors and rumor¬
mining genuine investment prac¬
manic - depressivism demonstrated mongering, whether it be direct
r
tice.
in
quick succeeding editorial or by implication. From bitter ex¬
(6) This investment caveat also
changes between optimism and perience, even a Lord Keyes came
pessimism — following and ra¬ to learn that' "the laws of arith¬ applies to pictorialization in the
news
columns
and
service s,
tionalizing the course of prices. metic are more reliable than the
:•

dulges.

Avoid the rationalization of mar¬

the

after

action

and
thus recognize would-be explana¬
ket

torial treatment of

and peace

war

If Korean peace pros¬
pects happen to brighten at a pe¬
riod of falling prices, they are
blamed.
Contradictorily, Middle

prospects.

trouble

East

also

war

and peace as bull and

"reasons"

scrutiny

are

the

bear
after

interchanged

quotation

day's

Concentrate

value

individual issues, in lieu of either
the press or

the

difficulty

yield of individual
stocks today, by reading

the

common

(2)—(1) As

first caveat,

my very

the dividend tables in two

or more

pany

directorates, both from

pany

pany,

even

fusing values with market prices.

praising.
in

with

clivity

the

emphasis

commentators'

only

of the twin

one

bearish

ments, to support either

pretation

or a

pro¬

exclusive

concentrate

bullish

sets

commented

are more

ular than the "regular"

forecast.

ele¬

inter¬

The

prac¬

(as

well

from the
very

the

reg¬

disburse¬

financial

the

pages

non-financial)

index, which

efficient.

tention

the

are

usually

Pay particular at¬
index

With American Securities
(Special

The

Financial

Chronicle)

CHICAGO, 111.—Foster S. Ran-

dle,

Jr.,

with

American

has

become

associated

Securities

Corpo¬

ration, 11 West Monroe Street. He
was

formerly with Bacon, Whipple
prior thereto with Stern

& Co. and

Brothers and First Boston Corp.

editor

"Times,"
Each

seems

New

of the

ten

foremost

New York

to have been ideal.

Year's

the

foremost

day

bullish

bearish

will

in it.

get into

cause

look
issue

transaction

listed
the

and

elements

the

soon

market

after your

Otherwise,

you

lot of trouble be¬

of your emotional

reactions

having been "proved right"

"wrong"

temporarily.

course,

stock you don't own goes up
without you in it, the emotional
if

anguish

applying to from

factual corporate news.

Don't

(4)

action of

Read

ket

tice of Alexander Dana Noyes, late

ments.

(5)

sphere

(3) Avoid the temptation to fall

com¬

and intra-com-

being

verbiage
or
the strato-.

of
calculus.
Automatic
"signaling" as the means to mar¬
profit, tempting as it is, con¬
Don!t
follow market quotations'
stitutes a major disservice to the
any more closely than is absolute¬
genuine investor in
distracting
ly necessary. Quotation-conscious¬ him from concentration on con¬
ness should be relegated to a role
structive value considerations.
strictly secondary, to
value-ap¬

I would strongly urge against con¬

publications, and get the answer the situation of the time, and
through a process of osmosis. The simply left it to the reader to
trouble is, of course, partly due
take his pick and make the net
to the non-uniform policy of com¬
decision.
company

through

concocted

financial

the ticker.

Handle

(4)

judging

whether

' >

charts

for

blamed

market reaction. The market roles

winds of rumor."

event,

tory comment and often even fore¬
casting;
This fallacy has been
newly demonstrated in the edi¬

that extra dividends

began with an at¬

course

if he

cation

land.

Even

not die in battle, but that we

probable

& Co.

of full-time citizenship— be done, at least before a broker's
of citizenship that ex¬ order is entered.
beyond the borders of any
(5)
Beware of over-dramatiza¬

shell and only a temporary

that

challenges

If bonds,

Stuart

Corp.; Harris, Hall & Co. (Inc.); Kidder,
Peabody & Co.; Carl M. Loeb, Rhoades & Co.; Salomon
Bros. & Hutzler; Union Securities Corp.; Merrill Lynch,
Pierce, Fenner & Beane; Shields & Co.

face fulltime citizens, whether in civilian
The

Halsey,

Boston

First

tested in other ways. Peace

Challenges

ticker.

planation of American democracy.
I decided to do something about
numerable

are

"One

continues,

all

this

effective,

26, they
better."

given these Korean offi¬
that there was absolutely
devoted to the most im¬

his

weaknesses

The average citizen is a poor poli¬
were

22
mostly captains
young,

very

tician.

after
West
intelligent

very

are

people. Their families have been
assassinated'by the Reds, their
homes burned. Although they are

The

the business of

every

politician.
words

best sense of

Corp.

kind

tends

include:

may

Yet in

only ago

handful of people are willing to
take the leadership in community
a

tribution

-^bidders

full-time citizens.

full-time

have

often

in¬

family.

community activities

find

night

Citizens

88 mil¬
potential voters less than 49

smaller

the

out

Yet, in 1948, out of over

coverage

written

was

the word.

vote.

than 42 million

degree

one

in the

citizen

time

young

lieutenant who is a full-

young

also use his

will

him.

sents

for

officers." '.W-v

Our Strength

the

see

can

far-reaching value of a course in

1952.

(EST)

15.

ing has not yet been determined.

to issue'

hostilities

Continued from page

proposes

company

of general mortgage bonds, series^Br*

1976. Underwriters—To . he determined by
competitive bidding. Probable bidders: 'Halsey, Stuart &
Co. Inc.; Kuhn, Loeb & Co.; Morgan Stanley & Co.;
Salomon Bros. & Hutzler.
Proceeds—To retire a like
due

and

announced company plans to issue

was

and sell $14,950,000

Norman Co.

a.m.

E.. Kohlepp, President, announced company
plans to build a $12,000,000 steam turbine power plant
in Marathon'County, Witf.rrMethdd of permanent financ¬

(11/15)

Maryland Ry.

Western
Oct.

at 11:30

Sept. 4 C.

'v;.y\v

(

rate purposes.

Oct.

be received

Wisconsin Public Service

Underwriter—

Proceeds—For working capital.

share).

bonds due Oct.

mortgage

Westinghouse Electric Corp.
;
Sept. 26, it was announced stockholders will vote Dec. 14
on
increasing authorized indebtedness to $500,000,000
from $150,000,000 in connection with a $296,000,000 ex¬
pansion program.. Company plans sale of debt secu7
rities the type and amount of which are undetermined
(may be private). Traditional underwriter: Kuhn, Loeb
& Co., New York.

will vote Nov. 27

announced stockholders

Oct. 22, it was

competitive bidding.
Bidders for an issue of like amount sold on July 24 were
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co., White,
Weld & Co. and Equitable Securities Corp. (jointly);
The First Boston Corp., Harriman Ripley & Co., Inc., and
Goldman, Sachs & Co. (jointly). Proceeds—For expan¬
sion program of United Gas System and for other corpo¬
Underwriters—To be determined by

first

Expected to

—

Nov.

Vertientes-Camaguey Sugar Co.

the latter part of the year.

collateral trust bonds during

Van

Bids

capital.

working

to complete

pated this

common

shares of common stock and on

Corp.

amount

stock by an additional 200,000
authorizing issuance of
all or any part of such increased shares by the directors
without prior offering to stockholders.
Underwriter—
Paine, Webber, Jackson & Curtis, Boston, Mass. Proceeds
ing authorized

page

may

actual

even

greater than

loss, but looking

at un-bought stocks

prices has to

Mayer & Hart to Admit
Hart, 1 Wall Street,
City, members of the
York Stock Exchange, will

Mayer
New
New

admit

York

Joseph

partnership

Piddian

limited

Jan. 1, 1952.

Volume 174

Number 5064

The Commercial and Financial-Chronicle

(1887)

basis was necessary. to
successful conclusion of the

4.50%
assure

deal.

Well the issue came out this

week

carrying

and

priced

4.70%

4.60%.

•
'

dividend

102.17

yield

;

Corporates

Ahead

Two large municipals on sched¬

Two With

ule next week include $80,000,000

COMING

Michigan Limited Access High¬
way revenue bonds, due serially
1955*4© 1976 and $60,000,000 of
State of Pennsylvania tax antic¬
ipation notes, due May 29, 1952.

SAN

Investment

sizable

bring out three
of new
debt "fi¬

pieces

nancing, two for utility companies
third

the

and

for

have

Field

Johnson & Higgins, 300 Mont¬

son,

'•

ment

bankers

and

financing to be done.
Conditions

helped

Tuesday,

people „with

'.V

have

v,-.
been

not

banking
the

by the ragged behav¬

any

tops

the

list

and

funds

plan

groups

issue

Proceeds,

to be

raised

ior of the Treasury list which has
been blowing "hot" one day and

"cold" the next for
<'

considerable

7".'

•*

Meanwhile bankers

toward
with

busy week what
large corporate is¬

and at least two sizable

Attempts to

by the sale of

not

falls in the

category of

sized

out-wait the

mar¬

have

been

recent

appear

off"v for

the

months.

than-

offered

But

company

satisfied

least

seven

not

with

which

been

..Consensus

have

Bankers

then

■-1

•

;

$25,000,000^^^

sinking fund debentures havihi-a;

and

retire

ferred.

outstanding

■■

■■7'; /?".
-

' *

•'

v.,

American

Transportation—Analysis—Stanley
Co., 30 Pine Street, New York 5, N. Y.

(Miami, Fla.)

E. W.

National

ciation

Security Traders Asso¬

Convention

The

Tlie

terly

Board

dividend

Directors

the

Valley

Lehigh

Industries,

Railroad

Electric

McGraw

Co.,

has

Inc.—Card

memorandum—G.

Public Utility

Company

become

H.
New

the

Stock

Francisco

previously

was

York

The

DIVIDEND

California
'.?•••

Brewing

William

Placer

Notice to

Also

Babbitt, Inc. has declared

—

Hammill

payable

pany,

Edison,

England

memorandum

and

December 12, 1951.

Directors

semi-annual

the

cents

per

COMMON

STOCK, payable December
17, 1951 to stockholders of
record
ness

LEO W. GEISMAR, Treasurer

the

November 26,
WM.

of busi¬

1951.

Hickey,

November 13, 1951

President

November

Fenner & Beane.

8, 1951

NOTICE

Washington

September 30,1951
Electric

Cleveland

Illumi¬

erally available to

its security

provisions of Section 11(a) of
the

Associates,

Act

Securities

amended,

1933,

earnings statement

for the twelve months ended

September 30, 1951, such period

beginning after the effective date
of the

Co.—Analysis—Ira Haupt & Co., Ill

statement

-■■

for

Bonds,

and

Seneca

THE TEXAS COMPANY
197th

ENCAUSTIC TILING

Consecutive

Common ■■

The Board of Direc-

„

tors

clared

quarterly dividend of
12t/2 cents plus an extra divi-

dend of 5 cents

the

regular quarterly dividend of
sixty-five cents (65^) per share and

■■

Common Stock, payable November 30, 1951, to stockhold-

■■

55
55
55
55
55

■■

has

today de-

■■

G. W. THORP, JR.

of record

November 23,

1951.

cents

■■

dividend

(75^)

record

per

the close of business

The stock transfer books will
main

Treasure*

$25,000,000 First

<£>

Exchange Commission

Falls Machine Co.

Sears Roebuck—Brief data—Bache &
York 5.

N. Y.

Also available

and Soeony Vacumm Oil.

are

Powers

Anaconda

security holders
ested

Valley Securities Co.,

Mass.

Also

Co., 148 State Street,
available is information on Thermo

Pacific

other inter¬

Dividend Notice

CLEVELAND ELECTRIC
COMPANY

By Sydney L. Hall
;

Vice President and Secretary

ber 9, 1951 declared a regular

($1.00)

75 Public Square •

Railroad

Company—Review—Sutro

Co., 120 Broadway, New York 5, N. Y.

Bros.

Cleveland 1, Ohio

per

also declared
on

King Railway.
Western

CITIES SERVICE COMPANY

parties.

ILLUMINATING

Street, Chicago 3, 111.

U. S. Thermo Control—Data—Raymond &
Boston

re¬

The Board of Directors of Cities Service Company on Novem¬
THE

Company—Analysis—Dempsey & Company/

135 South La Salle

upon

quest to any of the Company's

Copper

Building, Rochester 14, N. Y.

South Jersey Gas

•

Seneca Oil Company—Analysis—Genesee
*

Copies will be mailed

Co., 36 Wall Street, New

data

such stock.

its $10

quarterly dividend of

par

stockholders of record

one

dollar

value Common stock. The board

special dividend of
Both dividends

re¬

Robert Fisher
October 26,1951

under said Act.

open.

■luiHUimuaaHiiHiUHHUft

2%% Series
Securities

November 9, 1951.

Extra

of seventy-five
share on the Capi¬
tal Stock of the Company have been
declared this day, payable on De¬
cember 10, 1951, to stockholders of
an

55
55
55
55

Treasurer

ers

■■

Dividend

and Extra Dividend

■■

dividend

55
55
55

due 1985, filed with the

Also available is
on

FLOOR

Company's registration

Mortgage

Gear Grinding Machine Co. and

WALL &
TILE

S= COMPANY, INC.

nating Company has made gen¬

Water

memorandum—Lerner

■■

holders, in accordance with the

Company—Card

DODGE, Secretary.

Board

declared

dividend

January 2, 1952

EE AMERICAN

The

•\

Co., 10 Post Office Square, Boston 9, Mass.
a

has

of record at the close

of business

Merrill

Security Holders of

Months Ended

Company—Bulletin—Gartiev

Cement

The

regular

and

Broadway, New York 6, N. Y.
Riverside

York, N. Y., November 8, 1951.

Earnings Statement for the Twelve

Limited—Analysis—John R. Lewis, Inc.,
Avenue, Seattle 4, Wash.

New

the Common Stock of the Com¬

Illuminating Company

Alstyne,

Development

Northern

the rate of

the UNITED Corporation

quarterly dividend of 15c pershare

The Cleveland Electric

Street, New York 5, N. Y.

1006 Second

Directors

Board

Exchanges.

with

CONSECUTIVE

92nd

Hoffman

New

tax

for¬

was

Goodwin, 265 Montgomery Street,
of

shareholders

will be deducted.
By Order of the Board of Directors,

Co., 317

Walston,

30,

7^%

affiliated

South Africa funds prior to
1951. Union of South Africa

for

non-resident

iiinmiHii

Supply—Analysis—Edward L. Burton & Co., 160
South Main Street, Salt Lake City 1, Utah.
Also available
are analysis of Equity Oil and Utah Southern Oil.
68

December 11, 1951 to the

1946. The dividend will amount
$1.67 per share, subject, however; to any
change which may occur in the official rate of

Manufacturers of

Mountain Fuel

Pfeiffer

dated June 24,

November

M. Dempsey has joined the

FINANCIAL

Common Stocks.

Co.—Memorandum—Shearson,

Power Co.

payable

December 4, 1951 of American shares issued
under the terms of the Deposit Agreement

1951

exchange

FRANCISCO, Calif.—Ter-

Lynch, Pierce,

Northern States Power Co., Pacafic Gas & Electric

Southern

the said dividend

Pont

Power

Company

th e

holders of record at the close of business on

(Special to The Financial Chronicle)

SAN

San

Co.—Memorandum—Smith, Barney & Co., 14
Wall Street, New York 5, N. Y.—Also available are memo¬

randa

„

November 30, 1951.
The Directors authorized the distribution

Secretary

ALEXANDER,

Ordinary

quar¬

to stockholders

Co., 14 Wall Street, New York 5, N. Y.
Montana

14, 1951 to
close of business
D.

Montgomery Street.

Analysis — Van
Noel & Co., 52 Wall Street, New-York 5, N. Y.

declared

has

cents per share payable
stockholders of record
on November 23,
1951.

sixty

December

The Board of Directors today declared a dividend of twelve shilliiigs per share on the

Singer Manufacturing
Company.

November.

Cimin0

Company

bulletin

Limited

SAN FRANCISCO, Calif.—John

members

Co., Inc.. 70 Pine Street, New York 5, N. Y.

available is

siiiiiiiiiiiiiiiiiiiuiniiiiiiiiiiiiiiiiiiiiimiiiiiiiiiiiiiiiiiiiiii

Roney

(special to the financial chronicle)

of Canada, Ltd.—AnalysisSons, 367 Main Street, Winnipeg, Man.,.
Canada and Royal Bank Building, Toronto, Ont., Canada.
Oil

the

ATKINSON, Treasurer

1951.

Plaza Hotel.

James Richardson &

Saxton &

November 13,

been declared

Oakes Manufacturing Co.

Nickel

Kerr-McGee

staff

Heller;? ;

regular quarterly divi'

5
5

■=

Annual Convention.

Oct. 19, 1952

dcnd of

50tf per share has
on the
Capital Stock of this
Company,, payable December 18, 1951, to
stockholders of record November 30, 1951.
The stock transfer books will remain open.

Association

Bankers

Dividend No. 20

rence

Company—Review—Sills, Fairman &
Harris,,Inc.,. 209 South La Salle Street, Chicago 4, III.
Also

City, N. J.)

Walston, Hoffman Adds

International. Harvester

Sept. 28-Oct. 1, 1952 (Atlantic

QUARTERLY

Inc., 150 Broadway, New York 38, N. Y.

available is data

ing at the Hotel Galvez.

merly with J. Barth & Co.

Ilarrisburg Steel Corporation—Analysis—Amott, Baker & Co.,

International

Spring Meet¬

With F, I.

sale of 200,000 shares of $4.25 convertible preferred stock, $100 par,

Investment

O'okiep Copper Company

now connected with T. J.

t...

Group

Bankers Association

pre-

This operation also involves the

DIVIDEND NOTICES

(Galveston, Tex.)

DIVIDEND NOTICES

Pringle Adds

Street***'?
'

Colo. — Sterner A.
joined the staff of
Management Corpora¬

has

tion, 445 Grant Street.

;

Prin8le Invp^tment Co., 515 Mar-

20-year maturity, as a means of ket
raising funds to finance expansion
'

Jacob

May 1-2, 1952

'?7.'7;y.v

T. J.

Remple
Hamilton

Convention at the Holly¬
wood Beach Hotel.

Ruppert, Beryllium Corp. and
Safety Car Heating & Lighting.

General

■

(Special to the financial chronicle)

DENVER,

(Hollywood

the

if big

one

(Special to The^Financial Chronicle)

Recommendations and Literature
comments

hesitation.

derwrite the. sale of
?

■'1

are

that

was

lag if this type of investor showed

Dealer-Broker Investment
issue

competent

at the start, but naturally would

25-30, 1951

American

with Francis I. du Pont &
■

issue

Sylvania Electric Products Co.,
tfcVEPGRT, La.— John S.
is negotiating with bankers to
uri-sv

meant

Continued from page 8

Ex¬

With Hamilton Managem t

Investment Bankers Assoclattoi

3.27%.

quick

winning

re-offer the

observers

Club

Annual

institutional buyers are interested

en¬

that

argued

clear¬

and

among

Women's

Beach, Fla.)

in-

much

and

Commission, the
to

Nov.

Texas

award

Securities

101.783 to yield

offerings
which ,have
more
frequent in
recent

months.

terms ^pro¬

would

thinking

(Philadelphia, Pa.)

Philadelphia meeting at Kugler's.

poratiom,

back.

or so

was

;

one
of those negotiated industrial cor-1

price to yield about 4.35%.

the

plans

group

of 101.15, which
were

formal

y.V, Tuesday likewise will bring

by. bankers negotiating the
business. At. that time,it is un¬
derstood, the company sought a
basis

Upon
ance

"Street'VJrnarket

rY Sylvania Electric

V-.

posed

this

Service

occasion.

one

fortnight

the.

tirely

they

price to

the"same'lines'.'

along

competition: wilT. deal could be

with

set to

since

and

issuer

Public

Currently the company has been
engaged
in
seeking to 7 market
249,942 shares iE$Miew: cumulative
$100- par value-preferred stock.
It was originally on schedule to
-

keen

groups

Electric & Gas Co., has found this

operation,

„

dicate

bidding for the

rate, set

cohipany

the

change

bonds

interest

"paying

out

of common stock,
"rights" will be used to finance

ket; do

with

The runners-up
same

19, 1951

Investment

suc¬

cessful group paying the company
101.28 for a 3%% coupon.

mortagage

tax-

exempt undertakings on schedule.
•

for

Gulf
States
Utilities
Co., on
Monday will be opening bids for
$10,000,000
of
its
30-year first

moving

are

rather

several

sues

633,274

bid

along

construction.-1

period.

indicated that at least three

now

Nov.

and

total of four bids with the

secondary
bond
marketPacific Telephone & Telegraph
still appears unable to adjust itself
Co.'s $30,000,000 of new 30-year
definitely to a new yield basis debentures, duer up for bids next
much to the discomfort of invest¬

Co.'s $40,000,000
refunding mort¬
bonds, due in 25 years, drew

general

gage
■

gomery Street.

Edison

Detroit Edison
of

industrial

an-

firm.
The

Detroit

FRANCISCO, Calif.—My¬

E. Hamm and James T. Love
become affiliated with Wil¬

ron

4ft

Next week will

Wilson, Johnson

(Special to The Financial Chronicle)

EVENTS
In

are

one

dollar ($1.00)

per

payable December 17, 1951

of the close of business November

1951.
W. ALTON JONES, President

The Commercial and Financial Chronicle,.

Thursday, November 13,> 1951

(1888> '

52'

BUSINESS BUZZ

Business
•

•

: *>.'

f Man's

Behind-the-Scene Interpretations
Nation'* Capital

from the

WASHINGTON, D. C.

Foreign Relations
committee, of which Senator Tom
Connally

Texas

is Chairman.

figuring, price

into

from a substantial inin the usage of machinery.

program,
•crease

Chapman,
Secretary of the Interior, wants to
have control over the distribution
of the power, whereas the New
York Power Authority wants it.
If
Congress can be 5 kept from
taking a hand in this fight, it may
Power

cost

Depletion is disallowed as a

$tem, except as it is based on the
eost of a wasting asset. Any bonus
or

fio

profit sharing is also ruled out.
are losses based on the sale or

disposition of capital assets. Any
\wusual costs such as those based
on
floods,
hurricanes, or civil
disturbances also are disallowed.
welfare

based

costs

pension

amortization

Any

vices to a company are

stock

does

liased upon a

certificate of necessity.

not

including
inventory

from

incurred

those

write-downs.
*

■„

i~-

■1

Treasury Secretary Snyder's es¬
timate of a deficit of $7.5 billion

not

tfor the current fiscal year is

There

borrow

need
U.

Budget Bureau, and revenues in
the neighborhood of $64 billion.
"The latter is not an official esti¬

Dominion

mate.

•

may

the

project.

get well into the construction

before either the
Ontario Hydro has to

project

the

that Canada will
money from the

finance

thing around $6 billion, with ex¬
penditures totaling $70 billion, as
now
officially estimated by the

than

thought

less

few months ago

between actual expenditures
revenues will
run to some¬

and

'i",*'.s 'i5

.,'1. »-.,*>

edition

Revised

Press

Rothschild, 2nd
— The
Ronald
15

Company,

Street, New York
Fabricoid—$12.00.

26th
Y.—

East
10, N.

"Expanding Your Income"—Ira

6-A,
Commercial & Financial
Chronicle, 25 Park Place, New
Cobleigh —$2.00 —Dept.

C 1,

Box

York

7, N. Y.
Reserves—Mur¬

Food and Feed

Benedict—National Plan¬
ning Association, 800 Twenty-first
Street, N. W., Washington 6, D. C,
R.

ray

—Paper—50c.
Freedom

Foundation
"—Then

bond issue, and
some time after that before such
a
bond
issue
will
have to
be

Educa¬

Economic

for

gle copies, quantity prices on re¬
the

Rules

insisted

group

icates"

upon

•

might

become

regular

quest. 7

financing for

feature of Treasury

the future years.

Another

the

phase

;

.•

;

Investment

while called "tax
anticipation certificates," may also
be paid off in cash, the same as
These

jurisdiction nominally ex¬
cludes veterans' matters, it was
mittee

atively

prettier if

look

criticism

little

standards.

/..;;/vV:V

new

maturities.

the

The Forrestal

Diaries

Edited

—

Walter Millis — The Viking
Press, Inc., 18 East 48th Street,
New York 17, N. Y.—cloth—$5.O0k

there

about

the

Monetary

in¬

until

For

Large

quiry reaches the hearings stage.
At

the Federal

Patman

Inc., Pittsburgh, Pa.-

Fabrikoid.

that

doubted
faces

Board

Reserve

time

the committee will
check into VA housing standards.
However,

may

will be

FHA's

subcommittees have

bills,

other Federal

FHA
as
well as VA policies were in¬
cluded. Actually there is compar¬
thought

& Bragdon,

strategy

the Banking com¬

is that because

After its

•'

present there is only one va¬

Appreciation Potential
WE SUGGEST

re¬

■

project as a joint Dominion-U. S.
project.
' This estimate, it is believed;- is
If there is a vacancy on

erans

offices throughout
to make loans
for disaster relief.1 The RFC :pro-f
RFC

the

set

entire

region

that it would

vided

ihe House Public Works commit¬

matically approve iany loan fof
$5,000 or less recommended by

which handles the project,
Speaker Rayburn should

and

appoint to this vacancy a Repre¬
sentative favorable fo the seaway,

bank in the flood-damaged
region. The bank's recommenda¬
tion
would ~ be
based " upon
its

slim chance

spokesmen

all over the country

from

air complaints

against builders, Y4-

ing appointments until

act

here

■

'■

■

here

California., ?,; ■

receive

and

./•'/
and"

Analysis of this Company
ft

review of the Cement

try available

upon

J"-

'Y-

Priced about

V;;" ■''

4 It; would not surprise informed
observers

of cement; te;K
Southern : ; Y

Indus- .v.

request.4..

them.
1

(common); STOCKY;

;v A leading producer in * fast-growing

Congress

CLASS B

!'■

;

the

long

dis¬

(This column is intended to

re•

fleet the "behind the scene" inter¬
pretation from the nation's Capital

513.00

per

LERNER & CO. 44
Investment

Securities

•

knowledge that the borrower was

that the committee might give the

their

and

almost auto¬

«ound.

tee,

willing and able to repay the loan.

Chen there would be

project a favorable report in 1952
t>y a 1-vote margin, say 14 to 13.
This is the most the project could
tiope for next year.
Then,-after
committee

tproject,

clearance

mittee

would

before

servers

would
more

Works

give

seaway

resolution to give Joe Stal¬

Congressional
Honor—but not much

off,

applications

began to

Medal
more.

the "Chronicle's"

coincide with

TeL HTJbbard

views.)

own

9, Mass.

2-^1990;;

;

•\

In spite
do

Allied Electric Products
FIRM TRADING MARKETS

FOREIGN

Kingwood Oil

SECURITIES

Standard Cable

;

of its unwillingness to

the House Banking com¬
mittee probably will make a study
of the
design and construction

HARL MARKS & HO- INC.

Texas Engineering

Cr Mfg.

so,

standards
loans.
When

used for
-

;

and
r

FHA

FOREIGN SECURITIES SPECIALISTS
-

Hill, Thompson & Co., Inc.

50 BROAD STREET...NEW YORK 4, N. Y.

TEL. HANOVER 2-0050... TELETYPE: NY 1-971

Trading Department
'

the committee sought to

Afterwards, even if these im¬ get approval of the Rules Com¬
possible obstacles could be. hur¬ mittee for its world travel junket,

"tax anticipation certif¬

fall

the end of October, and

near

offices.

Ob¬

and may or may not

10 Post Offfct Sfuare, Boston

aggregate of $17.5 million

get

favorable prospects

the

before

Com¬

floor

using

Treasury is

On this liberal basis RFC found

get

count bills which the

it had made only some 1,800 loans
for

RFC began closing its emergency

House.

the

Rules

could
the

any

out

have

the

it
in

slightly
'Chan

reported

from

consideration

Public

the

had

The—Oscar

Move,

tion,
Inc., Irvington-on-Hudson,
N. Y.—Paper—No charge for sin¬

our Board
side, B. O.?"

to understand you think

are

meetings are a bit on the uninteresting

Cooley and Paul Poirot—The

raise money on a

■

and V. Henry

ton
—

floated in the U. S. market.
cancy, that caused by the resigna¬
-id
turned from their travels, a field
\ *'i
sjs
tion of Marriner S. Eccles. Even
Canada has reputedly ^ decided
staff will make preliminary stud¬
if Gov. M. S. Szymczak resigns,
io build the Great Lakes-St..Law¬
< As against President Truman's
ies.";^ These, will be followed by
rence
as he eventually expects to do to
seaway, on f hfer own, her proposal;1 last summer that flood
public hearings later in the ses¬
government announced/; because sufferers in Kansas and Missouri; sion;
take a job with a bank, before the
Tr
iiY:
.J•
.•
the belief that .there is' no would need $400 million for re¬
./ These hearings, however,
may new session, it is thought that
chance in the near future", that lief, : the experience; of the RFC
turn into gripe sessions as vet¬ there would be no point in mak¬
Congress; will approve, of this has been significant. , ; ;;1.
;
.'-.s.

Compen¬

sation—George Thomas Washing¬

Oscar

spring of 1953 before the Domin¬
ion can get going.
-

.eupported elsewhere in Congres¬
sional or Administration quarters.
The current concensus is that the
.gap

Judicial

sions, Governmental and
Controls over Executive

Company and the
wrapping up with approval of the
the next few years.
Investor, The—Rudolph L. Weissjunket, the clearing of the reso¬
4 Under the Mills plan, corpora¬ man—Harper & Brothers, 49 East |
lution by Rep. William B. Widnall
tions are gradually bringing their 33rd
Interior department over the latStreet, New York 13, N. Y.
(R., N. J.) for the investigation of
ter's attempt to preempt power the adequacy of construction and income tax payments to a current —$3.50. :; v:
v ..
rights on relatively small streams. design standards on insured and basis by 1954. The way the Mills
amendment operates, corporation
Report Service—Special intro¬
Another obstacle is the approval, guaranteed loans.
; ; 1;'
income tax payments tend to con¬ ductory offer for five weeks of f
of the International Joint Com¬
There is a little minor Congres¬
centrate during
report service I
the March and complete weekly
mission, a treaty body which has sional strategy in this thing. If
June dates.
(via airmail) plus three special
jurisdiction over the use of inter¬ the study had not been delegated
research studies and booklet *
national
waters.
This Commis¬ to the Banking committee, it
Hence, it would
seem to be
"Planning for Profits in the Stock
sion,
with Truman's
advance would have gone to the Veterans' propitious to offer bills like those
Market"—$1.00—Dept. C-95; In¬
blessing, is expected after follow¬ committee. The Veterans' commit¬ sold with the March, 1952 maturity
vestors Research Co., Santa Bar¬
ing due procedure
to approve tee, being the official Congres¬ and due to be sold for the June
■
Canada's construction of a seaway. sional arm of the veterans' lobbies, maturity, so as to provide an in¬ bara, Calif. '
strument in which business tax
These two questions, however, would have given a less sober and
Shareholder Relations:
Corpo¬
reserves can
be invested, market
ration
Annual
hardly can be settled before the scientific study to the problem
Report Require¬
conditions not being unfavorable
end of 1952, and it will be the than the Banking committee.
ments—Henry F. Reuter—Reuter

past ser¬
ruled out.

Finally, overhead costs may

op¬

Commission, which already is
locked in deadly battle with the

accelerated amor¬
not count, even if
government-granted

Include inventory losses,

stock

plans,

purchase

tions/deferred compensation, Pen¬

to the Federal Power

be referred

BiSalle says that

tization

Tycoon,

Profitand

gal Aspects of Salary and

sharing contracts, stock bonus

all reasonable costs
ceilings. In¬
stead, to a very considerable ex¬
against Truman not, only for his
tent, he followed the Truman line
left-wing policies generally, but
that
Papa
Government, rather
because Truman
is backing the
than Congress, knows best.
move to
swipe control of Texas
The revised order specifically
oil tidelands from the state.
disallowed some 22 items of over¬
The Canadian Parliament is ex¬
head cost.
Some of these were
pected to legislate a Crown com¬
routine, and some would perhaps
pany to undertake the seaway, at
arouse no great antagonism, such
its present fall session. Neverthe¬
as
disallowing costs involved in
less, tangible construction opera¬
paying over-ceiling prices, or
tions are unlikely to get under¬
over-ceiling wages, or excessive
and
unreasonable
expense
ac¬ way until well into 1953.
This is because two obstacles
counts. ;
> v//
have to be jumped, before Otta¬
On the other hand, DiSalle dis¬
wa
can
go ahead.
First, Canada
allowed as an item of overhead must
get an agreement regarding
cost, interest on borrowed money. the division of power with the
^Depreciation in excess of normal United States, and costs related
*nay not count, even if it arises, thereto.
This will take some doas is happening under the defense
ing, for the ambitious Public

dustry to count

Corporate

the

Business, Tax and Le¬

Executive:

Connally is in a tight spot facing
a
stiff primary fight as an Ad¬
ministration front man, in a state
which is seething with
revolt

in¬

Jean over

Compensating

clear the Senate

not

price regulation did
backwards to allow

turers'

have to

the project would

dled,

Con-

—

to the general impression,
Mike DiSalle's revised manufac¬

trary

v>'-J

70 WALL STREET, N. Y.
<

T.I. WHitehalt 4-4540

Full text of Commercial and Financial Chronicle : November 15, 1951, Vol. 174, No. 5064

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